EXHIBIT 10.4

# 

# PACIFIC VIEW PLAZA

# OFFICE LEASE

# LANDLORD:

# POI-CARLSBAD, INC.
                                              a Delaware corporation

# TENANT:

# HI/FN, INC.,
                                              a Delaware corporation

---

# SUMMARY OF BASIC LEASE
INFORMATION AND DEFINITIONS

This SUMMARY OF BASIC LEASE
 INFORMATION AND DEFINITIONS  (Summary) is hereby  incorporated  into and made a part
of the attached  Office Lease which  pertains to the Building  described in  Section 1.4
 below.  All references in the Lease to the "Lease"  shall  include  this  Summary.  All
 references  in the Lease to any term defined in this Summary  shall have the meaning set
forth in this Summary for such term.  Any initially  capitalized  terms used in this
 Summary and any  initially  capitalized  terms in the Lease which are not  otherwise
 defined in this Summary shall have the  meaning  given to such terms in the Lease.  If
there is any  inconsistency  between the Summary and the Lease, the provisions of the
Lease shall control.

|1.1 | Landlord's
Address:
|--- | -------------------

|    |                   |  |                                                                                                                                                                                                               
|--- | ----------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | For Notice:       |  | POI-Carlsbad, Inc.
3890 West Northwest Highway, Suite 400
Dallas, Texas  75220
Attention:  Thomas F. August
Telephone:   (214) 654-0886
Facsimile:   (214) 350-2409                                           
|    | With a copy to:   |  | POI-Carlsbad, Inc.
c/o Prentiss Properties Management, L.P.
705 Palomar Airport Road, Suite 320
Carlsbad, California  92009
Attention:  Deborah Street
Telephone:   (760) 438-4242
Facsimile:   (760) 438-0046
|    | For Payment:      |  | POI-Carlsbad, Inc.
c/o Prentiss Properties Management, L.P.
P.O. Box 31001-0915
Pasadena, California  91110-0915                                                                                              
|1.2 | Tenants Address: |  | HI/FN, Inc.
750 University Avenue Los Gatos, California  95032
Attention:  Jane Sinclair
Telephone:   (408) 399-3534
Facsimile:   (408) 399-3577                                                              

|1.3 | Site;
 Project:  The Site  consists of the  parcel(s) of real  property in that certain
 Project  commonly          known as Pacific  View Plaza  located at 5973  Avenida
 Encinas,  City of  Carlsbad,  County of San Diego,          State of  California,  as
shown on the site  plan  attached  hereto  as  Exhibit A  as such  area may be
         expanded or reduced  from time to time.  The Project  includes  the Site and all
 buildings,  improvements          and  facilities,  now or  subsequently  located  on
 the  Site  from  time  to  time,  including,  without          limitation,  the Building
 currently  located on the Site, as depicted on the site plan attached hereto as
         Exhibit A.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.4 | Building:
 A three  (3)  story  office  building  located  on the Site,  containing  approximately
 51,695          rentable square feet, the address of which is 5973 Avenida Encinas,
Carlsbad, California 92008.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.5 | Premises:
 Those certain  premises  known as Suites 140  and 218 as generally  shown on the plans
attached          hereto as  Exhibit B,  located on the first (1st) and second (2nd)
floors  respectively of the Building,          and  containing  approximately  14,576
 rentable  square feet (12,220  usable square feet) with  Suite 140          containing
 approximately  10,556 rentable square feet (8,850 usable square feet) and Suite 218
containing          approximately 4,020 rentable square feet (3,370 usable square feet).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.6 | Term:
 Sixty (60) months.
|--- | -------------------------

|1.7 | Commencement
 Date and  Expiration  Date:  The  Commencement  Date shall be July 1,  2005.  The
Expiration          Date shall, unless the Lease is sooner terminated as provided herein,
be June 30, 2010.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.8 | Monthly
Basic Rent: Upon the  commencement  of the Term of this Lease,  and on the first day of
each month          thereafter  during the Term of this Lease,  Tenant shall pay to
Landlord,  in advance and without  offset,          as Monthly Basic Rent for the
Premises the following monthly payments:
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-(i)-

---

| | Months of Term |  | Monthly Basic Rent |  | Monthly Basic Rent
per Rentable Square Foot | 
| | -------------- |  | ------------------ |  | ------------------------------------------- | 
| | *1  12        |  | $31,338.40         |  | $2.15                                       | 
| | 13  24        |  | $32,212.96         |  | $2.21                                       | 
| | 25  36        |  | $33,233.28         |  | $2.28                                       | 
| | 37  48        |  | $34,253.60         |  | $2.35                                       | 
| | 49  60        |  | $35,273.92         |  | $2.42                                       | 

*Including any
partial month at the beginning of the Term if the  Commencement  Date does not fall on
the first day of the month.

|1.9 | Tenant's
 Percentage:  28.20%,  which is the ratio that the rentable  square footage of the
Premises bears          to the  rentable  square  footage  of the  Building.
 Accordingly,  as  more  particularly  set  forth  in          Sections 4.3 and 4.4
hereof,  Tenant shall pay to Landlord 28.20% of the Operating  Expenses (as defined
         in  Section 4.4) in excess of Landlords  Contribution to Operating  Expenses"
as defined in Section 1.10          of the Summary  below.  Tenants  Percentage is
subject to adjustment in accordance  with  Section 1.3  of          the Lease.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.10 | Landlord's
 Contribution to Operating  Expenses:  Tenant's  Percentage of Operating  Expenses
 incurred by          Landlord  during  calendar  year 2005 (the  Base  Year),
 adjusted  to reflect  an  assumption  that the          Building is fully  assessed for
real  property tax purposes as a completed  Building  ready for  occupancy          and
that the Building is ninety-five percent (95%) occupied during such year.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.11 | Security
Deposit:  $35,273.92.
|---- | ------------------------------

|1.12 | Permitted
Use:  General office use only and for no other purpose whatsoever.
|---- | ----------------------------------------------------------------------------

|1.13 | Brokers:
 Prentiss Properties Management, L.P. represents Landlord.  No broker represents Tenant.
|---- | -------------------------------------------------------------------------------------------------

|1.14 | Interest
 Rate:  The lesser of:  (a) the rate announced from time to time by Wells Fargo Bank or,
if Wells          Fargo Bank ceases to exist or ceases to publish such rate,  then the
rate  announced  from time to time by          the largest (as measured by deposits)
 chartered  bank  operating  in  California,  as its prime rate or          reference
rate, plus three percent (3%); or (b) the maximum rate permitted by law.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.15 | Tenant
 Improvements:  The tenant  improvements  installed or to be installed in the Premises as
described          in the Work Letter Agreement attached hereto as Exhibit C.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.16 | Parking:
 A total  of forty  (40)  unreserved,  uncovered  parking  privileges  at no  additional
 cost to          Tenant,  which parking  privileges  shall be subject to the  provisions
 set forth in  Section 6.2 of this          Lease.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.17 | Business
 Hours for the Building:  7:00 a.m.  to  6:00 p.m.,  Mondays  through  Fridays  (except
 Building          Holidays).  Building Holidays shall mean New Year's Day, Labor Day,
 Presidents Day,  Thanksgiving Day,          Memorial  Day,  Independence  Day and
 Christmas  Day and such other  national  holidays as are adopted by          Landlord as
holidays for the Building.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.18 | Guarantor(s):
 None.
|---- | --------------------

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# TABLE OF CONTENTS

|    |  |                                  |  |                                                      |  |     
|--- |  | -------------------------------- |  | ---------------------------------------------------- |  | ----
|    |  |                                  |  |                                                      |  | Page
|1.  |  | Premises                         |  | 2                                                   
|    |  | 1.1                              |  | Premises                                             |  | 2   
|    |  | 1.2                              |  | Landlord's Reservation of Rights                     |  | 2   
|    |  | 1.3                              |  | Measurement of Premises, Building and/or the Project |  | 2   
|    |  |                                  |  |                                                      |  |     
|2.  |  | Term                             |  | 2                                                   
|    |  |                                  |  |                                                      |  |     
|3.  |  | Rent                             |  | 2                                                   
|    |  | 3.1                              |  | Basic Rent                                           |  | 2   
|    |  | 3.2                              |  | Additional Rent                                      |  | 2   
|    |  |                                  |  |                                                      |  |     
|4.  |  | Common Areas; Operating Expenses |  | 2                                                   
|    |  | 4.1                              |  | Definitions; Tenants Rights                         |  | 2   
|    |  | 4.2                              |  | Landlords Reserved Rights                           |  | 3   
|    |  | 4.3                              |  | Excess Expenses                                      |  | 3   
|    |  | 4.4                              |  | Definition of Operating Expenses                     |  | 3   
|    |  | 4.5                              |  | Definition of Real Property Taxes and Assessments    |  | 4   
|    |  | 4.6                              |  | Estimate Statement                                   |  | 4   
|    |  | 4.7                              |  | Actual Statement                                     |  | 4   
|    |  | 4.8                              |  | No Release                                           |  | 5   
|    |  | 4.9                              |  | Audit Rights                                         |  | 5   
|    |  | 4.10                             |  | Cap on Controllable Expenses                         |  | 5   
|    |  |                                  |  |                                                      |  |     
|5.  |  | Security Deposit                 |  | 6                                                   
|    |  |                                  |  |                                                      |  |     
|6.  |  | Use                              |  | 6                                                   
|    |  | 6.1                              |  | General                                              |  | 6   
|    |  | 6.2                              |  | Parking                                              |  | 6   
|    |  | 6.3                              |  | Signs and Auctions                                   |  | 7   
|    |  | 6.4                              |  | Hazardous Materials                                  |  | 7   
|    |  |                                  |  |                                                      |  |     
|7.  |  | Payments and Notices             |  | 8                                                   
|    |  |                                  |  |                                                      |  |     
|8.  |  | Brokers                          |  | 8                                                   
|    |  |                                  |  |                                                      |  |     
|9.  |  | Surrender; Holding Over          |  | 8                                                   
|    |  | 9.1                              |  | Surrender of Premises                                |  | 8   
|    |  | 9.2                              |  | Hold Over With Landlords Consent                    |  | 9   
|    |  | 9.3                              |  | Hold Over Without Landlords Consent                 |  | 9   
|    |  | 9.4                              |  | No Effect of Landlords Rights                       |  | 9   
|    |  |                                  |  |                                                      |  |     
|10. |  | Taxes on Tenants Property       |  | 9                                                   
|    |  |                                  |  |                                                      |  |     
|11. |  | Conditions of Premises; Repairs  |  | 9                                                   
|    |  | 11.1                             |  | Condition of Premises                                |  | 9   
|    |  | 11.2                             |  | Landlords Repair Obligations                        |  | 9   
|    |  | 11.3                             |  | Tenants Repair Obligations                          |  | 9   
|    |  |                                  |  |                                                      |  |     
|12. |  | Alterations                      |  | 10                                                  
|    |  | 12.1                             |  | Tenant Changes; Conditions                           |  | 10  
|    |  | 12.2                             |  | Removal of Tenant Changes and Tenant Improvements    |  | 11  
|    |  | 12.3                             |  | Removal of Personal Property                         |  | 11  
|    |  | 12.4                             |  | Tenants Failure to Remove                           |  | 11  
|    |  |                                  |  |                                                      |  |     
|13. |  | Liens                            |  | 11                                                  
|    |  |                                  |  |                                                      |  |     
|14. |  | Assignment and Subletting        |  | 11                                                  
|    |  | 14.1                             |  | Restriction on Transfer                              |  | 11  
|    |  | 14.2                             |  | Permitted Controlled Transfers                       |  | 11  
|    |  | 14.3                             |  | Landlords Options                                   |  | 12  
|    |  | 14.4                             |  | Additional Conditions; Excess Rent                   |  | 12  
|    |  | 14.5                             |  | Reasonable Disapproval                               |  | 12  
|    |  | 14.6                             |  | No Release                                           |  | 13  
|    |  | 14.7                             |  | Administrative and Attorneys Fees                   |  | 13  
|    |  | 14.8                             |  | Material Inducement                                  |  | 13  
|    |  |                                  |  |                                                      |  |     
|15. |  | Entry by Landlord                |  | 13                                                  
|    |  |                                  |  |                                                      |  |     
|16. |  | Utilities and Services           |  | 13                                                  

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|    |  |                                                                   |  |                                        |  |     
|--- |  | ----------------------------------------------------------------- |  | -------------------------------------- |  | ----
|    |  |                                                                   |  |                                        |  | Page
|    |  | 16.1                                                              |  | Standard Utilities and Services        |  | 13  
|    |  | 16.2                                                              |  | Tenants Obligations                   |  | 14  
|    |  | 16.3                                                              |  | Failure to Provide Services            |  | 14  
|    |  |                                                                   |  |                                        |  |     
|17. |  | Indemnification and Exculpation                                   |  | 14                                    
|    |  | 17.1                                                              |  | Tenants Assumption of Risk and Waiver |  | 14  
|    |  | 17.2                                                              |  | Tenants Indemnification of Landlord   |  | 15  
|    |  | 17.3                                                              |  | Reciprocal Indemnity                   |  | 15  
|    |  | 17.4                                                              |  | Survival; No Release of Insurers       |  | 15  
|    |  |                                                                   |  |                                        |  |     
|18. |  | Damage or Destruction                                             |  | 15                                    
|    |  | 18.1                                                              |  | Landlords Rights and Obligations      |  | 15  
|    |  | 18.2                                                              |  | Tenants Costs and Insurance Proceeds  |  | 16  
|    |  | 18.3                                                              |  | Abatement of Rent                      |  | 16  
|    |  | 18.4                                                              |  | Inability to Completet                 |  | 16  
|    |  | 18.5                                                              |  | Damage Near End of Term                |  | 16  
|    |  | 18.6                                                              |  | Waiver of Termination Right            |  | 16  
|    |  |                                                                   |  |                                        |  |     
|19. |  | Eminent Domain                                                    |  | 16                                    
|    |  | 19.1                                                              |  | Substantial Taking                     |  | 16  
|    |  | 19.2                                                              |  | Partial Taking; Abatement of Rent      |  | 16  
|    |  | 19.3                                                              |  | Condemnation Award                     |  | 16  
|    |  | 19.4                                                              |  | Temporary Taking                       |  | 17  
|    |  | 19.5                                                              |  | Waiver of Termination Right            |  | 17  
|    |  |                                                                   |  |                                        |  |     
|20. |  | Tenants Insurance                                                |  | 17                                    
|    |  | 20.1                                                              |  | Types of Insurance                     |  | 17  
|    |  | 20.2                                                              |  | Requirements                           |  | 17  
|    |  | 20.3                                                              |  | Effect on Insurance                    |  | 18  
|    |  |                                                                   |  |                                        |  |     
|21. |  | Landlords Insurance                                              |  | 18                                    
|    |  |                                                                   |  |                                        |  |     
|22. |  | Waiver of Claims; Waiver of Subrogation                           |  | 18                                    
|    |  | 22.1                                                              |  | Mutual Waiver of Parties               |  | 18  
|    |  | 22.2                                                              |  | Waiver of Insurers                     |  | 18  
|    |  |                                                                   |  |                                        |  |     
|23. |  | Tenants Default and Landlords Remedies                          |  | 18                                    
|    |  | 23.1                                                              |  | Tenants Default                       |  | 18  
|    |  | 23.2                                                              |  | Landlords Remedies; Termination       |  | 19  
|    |  | 23.3                                                              |  | Landlords Remedies; Re-Enry Rights    |  | 19  
|    |  | 23.4                                                              |  | Continuation of Lease                  |  | 19  
|    |  | 23.5                                                              |  | Landlords Right to Perform            |  | 19  
|    |  | 23.6                                                              |  | Interest                               |  | 20  
|    |  | 23.7                                                              |  | Late Charges                           |  | 20  
|    |  | 23.8                                                              |  | Intentionally Omitted                  |  | 20  
|    |  | 23.9                                                              |  | Rights and Remedies Cumulative         |  | 20  
|    |  | 23.10                                                             |  | Tenants Waiver of Redemption          |  | 20  
|    |  | 23.11                                                             |  | Costs Upon Default and Litigation      |  | 20  
|    |  |                                                                   |  |                                        |  |     
|24. |  | Landlords Default                                                |  | 20                                    
|    |  |                                                                   |  |                                        |  |     
|25. |  | Subordination                                                     |  | 20                                    
|    |  |                                                                   |  |                                        |  |     
|26. |  | Estoppel Certificate                                              |  | 21                                    
|    |  | 26.1                                                              |  | Tenant's Obligations                   |  | 21  
|    |  | 26.2                                                              |  | Tenant's Failure to Deliver            |  | 21  
|    |  |                                                                   |  |                                        |  |     
|27. |  | Intentionally Omitted                                             |  | 21                                    
|    |  |                                                                   |  |                                        |  |     
|28. |  | Modification and Cure Rights of Landlords Mortgagees and Lessors |  | 21                                    
|    |  | 28.1                                                              |  | Modifications                          |  | 21  
|    |  | 28.2                                                              |  | Cure Rights                            |  | 21  
|    |  |                                                                   |  |                                        |  |     
|29. |  | Quiet Enjoyment                                                   |  | 21                                    
|    |  |                                                                   |  |                                        |  |     
|30. |  | Transfer of Landlords Interest                                   |  | 21                                    
|    |  |                                                                   |  |                                        |  |     
|31. |  | Limitations of Landlords Liability                               |  | 21                                    
|    |  |                                                                   |  |                                        |  |     
|32. |  | Miscellaneous                                                     |  | 22                                    
|    |  | 32.1                                                              |  | Governing Law                          |  | 22  
|    |  | 32.2                                                              |  | Successors and Assigns                 |  | 22  
|    |  | 32.3                                                              |  | No Merger                              |  | 22  

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|    |  |                               |  |                              |  |     
|--- |  | ----------------------------- |  | ---------------------------- |  | ----
|    |  |                               |  |                              |  | Page
|    |  | 32.4                          |  | Professional Fees            |  | 22  
|    |  | 32.5                          |  | Waiver                       |  | 22  
|    |  | 32.6                          |  | Terms and Headings           |  | 22  
|    |  | 32.7                          |  | Time                         |  | 22  
|    |  | 32.8                          |  | Prior Agreements; Amendments |  | 22  
|    |  | 32.9                          |  | Separability                 |  | 22  
|    |  | 32.10                         |  | Recording                    |  | 22  
|    |  | 32.11                         |  | Exhibits                     |  | 22  
|    |  | 32.12                         |  | Accord and Satisfaction      |  | 22  
|    |  | 32.13                         |  | Financial Statements         |  | 23  
|    |  | 32.14                         |  | No Partnership               |  | 23  
|    |  | 32.15                         |  | Force Majeure                |  | 23  
|    |  | 32.16                         |  | Counterparts                 |  | 23  
|    |  | 32.17                         |  | Nondisclosure of Lease Terms |  | 23  
|    |  | 32.18                         |  | Independent Covenants        |  | 23  
|    |  |                               |  |                              |  |     
|33. |  | Lease Execution               |  | 23                          
|    |  | 33.1                          |  | Tenants Authority           |  | 23  
|    |  | 33.2                          |  | Joint and Several Liability  |  | 23  
|    |  | 33.3                          |  | Building Name and Signage    |  | 23  
|    |  | 33.4                          |  | Landlords Title; Air Rights |  | 24  
|    |  | 33.5                          |  | Time of Essence              |  | 24  
|    |  | 33.6                          |  | No Option                    |  | 24  
|    |  |                               |  |                              |  |     
|34. |  | Waiver of Jury Trial          |  | 24                          
|    |  |                               |  |                              |  |     
|35. |  | Termination of Existing Lease |  | 24                          

|            |  |                            
|----------- |  | ---------------------------
|EXHIBITS    |  |                            
|EXHIBIT A |  | Project Site Plan          
|EXHIBIT B |  | Premises                   
|EXHIBIT C |  | Work Letter Agreement      
|EXHIBIT D |  | Form of Commencement Notice
|EXHIBIT E |  | Rules and Regulations      

-(iii)-

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# TABLE OF CONTENTS

|                                      | Page     
|------------------------------------- | ---------
|Abandonment                           | 18       
|Accountant                            | 5        
|Actual Statement                      | 4        
|Base Year                             | ii       
|Base, Shell and Core                  | Exhibit C
|Brokers                               | ii       
|Building                              | i        
|Building Common Areas                 | 2        
|Building Holidays                     | ii       
|business day                          | 8        
|Commencement Date and Expiration Date | i        
|Common Areas                          | 3        
|Controllable Expenses                 | 5        
|days                                  | 22       
|Environmental Law                     | 7        
|Environmental Permits                 | 7        
|Estimate Statement                    | 4        
|Excess Expenses                       | 3        
|Existing Deposit                      | 6        
|Existing Lease                        | 6        
|Final Space Plan                      | Exhibit C
|Hazardous Materials                   | 8        
|HVAC                                  | 9        
|Indemnified Claims                    | 15       
|Landlord                              | 1        
|Landlord Indemnified Parties          | 8        
|Landlord's Broker                     | 8        
|Lease                                 | 2        
|Monthly Basic Rent                    | i        
|Monument Sign                         | 7        
|Operating Expenses                    | 3        
|Original Tenant                       | 7        
|Over-Allowance Amount                 | Exhibit C
|Payback Period                        | 4        
|PCBs                                  | 8        
|Permitted Transfer                    | 11       
|Permitted Use                         | ii       
|Pre-Approved Change                   | 10       
|Preliminary Space Plan                | Exhibit C
|Premises                              | i        
|Project                               | i        
|Project Common Areas                  | 2        
|Real Property Taxes and Assessments   | 4        
|rent                                  | 2        
|Review Period                         | 5        
|Rules and Regulations                 | 6        
|Security Deposit                      | ii       
|Site                                  | i        
|Summary                               | 2        
|Tenant                                | 2        
|Tenant Changes                        | 10       
|Tenant Improvement Allowance          | Exhibit C
|Tenant Parties                        | 15       
|Tenant's Broker                       | 8        
|Tenant's Name Sign                    | 7        
|Tenant's Parties                      | 7        
|Tenant's Percentage                   | ii       
|Term                                  | i        
|Transfer                              | 11       
|Transfer Date                         | 12       
|Transfer Notice                       | 12       
|Transferee                            | 12       
|Work Letter Agreement                 | Exhibit C
|Working Drawings                      | Exhibit C
|worth at the time of award            | 19       

-(iv)-

---

# OFFICE LEASE

This LEASE,  which includes the
preceding Summary of Basic Lease Information and Definitions  (Summary)  attached
hereto and  incorporated  herein by this  reference  (Lease),  is made as of the 6th
day of May,  2005,  by and between  POI-CARLSBAD,  INC.,  a Delaware  corporation
 (Landlord),  and  HI/FN,  INC.,  a  Delaware  corporation (Tenant).

1     Premises.

1.1     Premises.
 Landlord  hereby  leases to Tenant,  and Tenant  hereby  leases  from  Landlord,  the
 Premises described in  Section 1.5  of the Summary  above,  improved or to be improved
 with the Tenant  Improvements.  Such lease is upon, and subject to, the terms,
 covenants and conditions  herein set forth and each party covenants,  as a material part
of the  consideration  for this Lease, to keep and perform their respective  obligations
under this Lease.

1.2     Landlord's
 Reservation of Rights.  Provided  Tenant's use of and access to the Premises is not
materially interfered with in an unreasonable  manner,  and subject to the terms of this
Lease,  Landlord  reserves for itself the right from time to time to install, use,
maintain,  repair, replace and relocate pipes, ducts, conduits,  wires and appurtenant
 meters and equipment above the ceiling surfaces,  below the floor surfaces and within
the walls of the Building and the Premises.

1.3     Measurement
 of Premises,  Building  and/or the Project.  Landlord  reserves the right to  re-measure
 the Premises,  the Building  and/or the Project and adjust all  provisions  of this
Lease which are based upon the area of the  Premises,  the  Building  and/or the  Project
 such as Tenant's  Percentage,  Monthly  Basic Rent,  and the Allowance, if any.  As used
in this Lease, the following terms have the meanings indicated:

|(a) | The
term usable  area or usable  square  footage  means the usable area as  determined,
 in Landlord's          reasonable  discretion,  in substantial  accordance  with the
Standard  Method for Measuring Floor Area in          Office Buildings, ANSI/BOMA Z65.1 -
1996 (the BOMA Standard);
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | The
term rentable  area or rentable  square  footage  means the rentable area measured,
 in Landlord's          reasonable discretion, in substantial accordance with the BOMA
Standard; and
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Landlord
 shall  have  the  right to  modify  the BOMA  Standard  in  Landlord's  reasonable,
 good  faith          discretion.
|--- | -------------------------------------------------------------------------------------------------------------------------------

2.     Term.
 The  Term  of  this  Lease  shall  be for the  period  designated  in  Section 1.6  of
the  Summary commencing on the Commencement  Date, and ending on the Expiration Date,
 unless the Lease is sooner  terminated as provided in this Lease.

3.     Rent.

3.1     Basic
Rent.  Tenant  agrees to pay  Landlord,  as basic rent for the  Premises,  the
Monthly Basic Rent in the amounts  designated in  Section 1.8  of the Summary.  The
Monthly Basic Rent shall be paid by Tenant in monthly installments  in the  amounts
 designated  in  Section 1.8  of the  Summary in advance on the first day of each and
every  calendar  month during the Term,  without  demand,  notice,  deduction or offset
 except that the first full month's  Monthly Basic Rent shall be paid upon Tenant's
 execution and delivery of this Lease to Landlord.  Monthly Basic Rent for any  partial
 month shall be  prorated  in the  proportion  that the number of days this Lease is in
effect during such month bears to a thirty (30) day month.

3.2     Additional
 Rent.  All amounts and charges  payable by Tenant  under this Lease in addition to
the Monthly Basic Rent described in Section 3.1  above  (including,  without  limitation,
 payments for insurance,  repairs and parking,  and Tenant's Percentage of Operating
Expenses in excess of Landlord's  Contribution to Operating Expenses as provided in
 Section 1.10  of the Summary) shall be considered  additional  rent for the purposes of
this Lease, and the word rent in this Lease shall include such  additional  rent unless
the context  specifically  or clearly implies that only the Monthly Basic Rent is
referenced.  The Monthly Basic Rent and  additional  rent shall be paid to Landlord as
provided in  Section 7,  without any prior notice or demand  therefor  and without any
 deduction or offset whatever, in lawful money of the United States of America.

4.     Common
Areas; Operating Expenses.

4.1     Definitions;
 Tenant's Rights.  During the Term of this Lease,  Tenant shall have the
non-exclusive  right to use, in common  with other  tenants in the  Project,  and
 subject to the Rules and  Regulations  referred to in Section 6  below,  those portions
of the Project (the Project Common Areas) not leased or designated for
lease to tenants that are provided  for use in common by  Landlord,  Tenant and any other
 tenants of the Project (or by the sublessees (agents,  employees,  customers invitees,
 guests or licensees of any such party),  whether or not those areas are open to the
general public.  The Project Common Areas shall include,  without  limitation,  any
fixtures, systems,  decor,  facilities and  landscaping  contained,  maintained or used
in connection  with those areas,  and shall be deemed to include any city sidewalks
 adjacent to the Project,  any  pedestrian  walkway  system,  park or other  facilities
 located  on the Site  and open to the  general  public.  The  common  areas  appurtenant
 to the Building shall be referred to herein as the Building  Common Areas and
shall  include,  without  limitation,  the following areas:

|(a) | the
common entrances,  lobbies,  restrooms on multi-tenant  floors,  elevators,  stairways
and accessways,          loading docks,  ramps,  drives and platforms and any passageways
and serviceways thereto to the extent not          exclusively
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-2-

---

| | another
 serving tenant or contained within another tenant's  premises,  and the common pipes,
         conduits, wires and appurtenant equipment serving the Premises; and
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | the
parking  structure and parking areas  (subject to  Section 6.2  below),  loading and
unloading  areas,          trash areas, roadways,  sidewalks,  walkways,  parkways,
driveways and landscaped areas appurtenant to the          Building.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Building  Common Areas and the
Project  Common  Areas shall be referred to herein  collectively  as the Common Areas.

4.2     Landlords
 Reserved  Rights.  Landlord  reserves  the right  from  time to time to use any of the
 Common Areas and to do any of the following,  as long as such acts do not  unreasonably
 interfere with Tenants use of or access to the Premises:

|(a) | expand
the Building and construct or alter other buildings or improvements on the Site;
|--- | ---------------------------------------------------------------------------------------

|(b) | make
any changes,  additions,  improvements,  repairs or replacements in or to the Project,
 the Site, the          Common Areas and/or the Building  (including  the Premises if
required to do so by any law or  regulation)          and the fixtures and equipment
thereof, including,  without limitation:  (i) maintenance,  replacement and
         relocation of pipes,  ducts,  conduits,  wires and meters;  and (ii) changes in
the location,  size, shape          and number of driveways,  entrances,  stairways,
 elevators, loading and unloading areas, ingress, egress,          direction of traffic,
 landscaped  areas and walkways  and,  subject to  Section 6.2,  parking  spaces and
         parking areas;
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | close
 temporarily  any of the Common Areas while engaged in making  repairs,  improvements or
alterations          to the Project, Site and/or Building; and
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | perform
such other acts and make such other  changes with respect to the Project,  Site,  Common
Areas and          Building, as Landlord may, in the exercise of its good faith business
judgment, deem to be appropriate.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.3     Excess
 Expenses.  In  addition  to the  Monthly  Basic Rent  required  to be paid by Tenant
 pursuant  to Section 3.1  above,  during each month during the Term of this Lease (after
the Base Year noted in  Section 1.10 of the Summary),  Tenant shall pay to Landlord the
amount by which Tenants  Percentage of Operating Expenses for such calendar  year
exceeds  Landlords  Contribution  to Operating  Expenses  (such amount shall be referred
to in this Section 4 as the Excess Expenses),  in the manner and at the times set forth
in the following  provisions of this Section 4.

4.4     Definition
of Operating  Expenses.  As used in this Lease, the term Operating  Expenses shall
consist of all costs and expenses of operation,  maintenance,  repair and replacement of
the Project (including the Building), the Site and the Common Areas as determined by
Landlord  utilizing  standard  accounting  practices and  calculated assuming the Project
is ninety-five  percent (95%)  occupied.  Operating  Expenses  include the following
 costs by way of  illustration  but not  limitation:  (a) Real  Property  Taxes and
 Assessments  (as defined in  Section 4.5 below) and any taxes or assessments  imposed in
lieu thereof;  (b) any and all assessments  imposed with respect to the Project  pursuant
to any covenants,  conditions  and  restrictions  affecting the Project;  (c) water and
sewer charges and the costs of electricity,  heating,  ventilating,  air conditioning and
other utilities;  (d) utilities surcharges  and any other costs,  levies or assessments
 resulting from statutes or regulations  promulgated by any government  authority in
 connection  with the use or occupancy of the Project  including,  but not limited to,
the parking  facilities  serving the Project;  (e) costs of insurance  obtained by
Landlord  pursuant to  Section 21 of this Lease; (f) waste disposal and janitorial
services;  (g) security;  (h) costs incurred in the management of the Project,
 including,  without limitation:  (1) supplies,  (2) wages,  salaries,  benefits, pension
payments, fringe benefits,  uniforms and  dry-cleaning  thereof (and  payroll  taxes,
 insurance  and similar  governmental  charges related  thereto) of employees  used in
the operation and  maintenance  of the Project,  (3) the rental of personal property
 used by Landlord's  personnel in the  maintenance,  repair and  operation of the
Project,  (4) management office expenses including rent and operating costs,  (5) accounting
 fees, legal fees and real estate  consultants fees, and (6) a
 management/administrative  fee not to exceed five percent (5%) of the annual gross
revenues of the Project;  (i)  supplies,  materials,  equipment and tools;  (j) repair
 and  maintenance  of the elevators and the structural portions of the Project,
 including the plumbing,  heating,  ventilating,  air-conditioning,  electrical and other
 utility  systems  installed or furnished by Landlord;  (k) maintenance,  costs and
upkeep of all parking and Common  Areas;  (l) amortization  on a  straight-line  basis
over (as  determined  by  Landlord)  the lesser of (x) the  Payback  Period (as
 defined  below) or (y) the  useful life (as  reasonably  determined  by  Landlord),
together  with  interest  at the  Interest  Rate (as defined in  Section 1.14  of the
Summary of this Lease) on the unamortized  balance  of all costs  classified  as capital
or major  repairs  and  maintenance  (as  determined  by Landlord) (including,  without
limitation,  capital improvements,  capital replacements,  capital repairs,  capital
equipment and capital  tools):  (1) intended to produce a reduction in operating  charges
or energy  consumption or effect other  economies in the operation or  maintenance  of
the Project;  or  (2) required  after the date of this Lease under any  governmental  law
or regulation;  (3) for  repair or replacement of any equipment or  improvements needed
to operate  and/or  maintain the Project at the same quality  levels as prior to the
repair or  replacement, including,  but not limited to, items which are rented (rather
than  purchased) in the ordinary course of business; or (4) which  are  reasonably
 determined  by Landlord to be in the best  interests of the Project;  (m) costs  and
expenses  of  gardening  and  landscaping;  (n) maintenance  of signs;  (o) personal
 property  taxes  levied on or attributable  to personal  property  used in  connection
 with the Project;  and (p) costs and expenses of repairs, resurfacing,  repairing,
 maintenance,  painting,  lighting,  cleaning, refuse removal, security and similar
items, including  appropriate  reserves.  For purposes of  determining  Landlords
 Contribution  to  Operating  Expenses, Operating Expenses shall not include  (i) one-time
 special  assessments,  charges,  costs or fees or extraordinary charges or costs
 incurred  in the Base Year  only,  (ii) market-wide  labor-rate  increases  due to
 extraordinary circumstances  including,  but  not  limited  to,  boycotts  and  strikes,
 (iii) utility  rate  increases  due  to extraordinary  circumstances including, but not
limited to, conservation surcharges,  boycotts,  embargoes or other shortages,  and  (iv) amortization
 of any capital  items  including,  but not limited  to,  capital  improvements, capital
repairs and capital  replacements  (including such amortized costs where the actual
improvement,  repair or replacement  was made in prior

-3-

---

years). In
no event shall costs for any item of  utilities  included in  Operating Expenses for any
year  subsequent to the Base Year be less than the amount  included in Operating
 Expenses for the Base Year for such utility item. In addition,  if in any calendar year
 subsequent to the Base Year,  the amount of Operating  Expenses  decreases  due to a
 reduction  in the cost of  providing  utilities,  security  and/or  other services to
the Project  for any reason,  including  without  limitation,  because of  deregulation
 of the utility industry  and/or  reduction in rates  achieved in contracts  with
 utilities  and/or  service  providers,  then for purposes of the calendar year in which
such decrease in Operating  Expenses  occurred and all  subsequent  calendar years,  the
Operating  Expenses for the Base Year shall be decreased by an amount equal to such
decrease.  Payback Period means the reasonably  estimated period of time that it takes
for the cost savings  resulting from a capital improvement  and/or a major repair or
maintenance item to equal the cost of the capital  improvement  and/or repair or
improvement item.

4.5     Definition
of Real  Property  Taxes and  Assessments. All Real Property  Taxes and  Assessments
 shall be adjusted  to reflect an  assumption  that the  Building  is fully  assessed
 for real  property  tax  purposes as a completed  building ready for  occupancy.  As
used in this Lease,  the term Real  Property Taxes and  Assessments shall mean: any
form of assessment,  license fee, license tax,  business license fee,  commercial rental
tax, levy, charge,  improvement bond, tax, water and sewer rents and charges,  utilities
and communications  taxes and charges or similar or dissimilar  imposition  imposed by
any authority having the direct power to tax,  including any city, county,  state or
federal  government,  or any school,  agricultural,  lighting,  drainage or other
 improvement or special  assessment  district  thereof,  or any other  governmental
 charge,  general  and  special,  ordinary  and extraordinary,  foreseen  and
 unforeseen,  which may be  assessed  against  any  legal or  equitable  interest  of
Landlord in the Project, including the following by way of illustration but not
limitation:

|(a) | any
tax on  Landlord's  right  to rent or  right  to other  income  from the  Premises
 or as  against          Landlord's business of leasing the Premises;
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | any
assessment,  tax, fee, levy or charge in substitution,  partially or totally, of any
assessment,  tax,          fee,  levy  or  charge  previously  included  within  the
 definition  of  real  property  tax,  it  being          acknowledged  by Tenant  and
 Landlord  that  Proposition 13  was  adopted  by the  voters of the State of
         California  in the June,  1978  election  and that  assessments,  taxes,  fees,
 levies and charges may be          imposed  by  governmental  agencies  for such
 services  as fire  protection,  street,  sidewalk  and road          maintenance,
 refuse  removal and for other  governmental  services  formerly  provided  without
charge to          property  owners  or  occupants.  It is the  intention  of  Tenant
 and  Landlord  that  all  such new and          increased  assessments,  taxes,  fees,
 levies and  charges be  included  within the  definition  of "real          property
taxes" for the purposes of this Lease;
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | any
 assessment,  tax, fee,  levy or charge  allocable to or measured by the area of the
Premises or other          premises  in the  Project  or the rent  payable  by  Tenant
 hereunder  or other  tenants  of the  Project          including,  without  limitation,
 any gross  receipts  tax or excise tax levied by state,  city or federal
         government,  or any political  subdivision  thereof,  with respect to the
receipt of such rent, or upon or          with respect to the possession, leasing,
operation,  management,  maintenance,  alteration, repair, use or          occupancy by
Tenant of the Premises, or any portion thereof but not on Landlord's other operations;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | any
 assessment,  tax,  fee,  levy or charge upon this  transaction  or any  document to
which Tenant is a          party, creating or transferring an interest or an estate in
the Premises; and/or
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(e) | any
assessment,  tax, fee, levy or charge by any governmental  agency related to any
transportation  plan,          fund or system  (including  assessment  districts)
 instituted  within  the  geographic  area of which the          Project is a part.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Notwithstanding  the foregoing,  if
after the  Commencement  Date Real Property Taxes and  Assessments are reduced, then for
purposes of all  subsequent  calendar  years  including the calendar  year in which the
reduction  occurs, Landlords  Contribution to Operating  Expenses shall be
 proportionately  reduced.  Notwithstanding  the foregoing provisions of this  Section 4.5
 above to the contrary,  Real  Property Taxes and  Assessments  shall not include
Landlord's federal or state income, franchise, inheritance or estate taxes.

4.6     Estimate
 Statement. By the  first  day of April of each  calendar  year  during  the Term of
this  Lease (after the Base Year noted in Section 1.10 of the Summary) or as soon
thereafter as reasonably  possible,  Landlord shall endeavor to deliver to Tenant a
statement  (Estimate  Statement)  estimating the Operating Expenses for the current
 calendar year and the  estimated  amount of Excess  Expenses  payable by Tenant.
 Landlord  shall have the right no more than  three (3) times in any  calendar  year to
 deliver a revised  Estimate  Statement  showing  the Excess  Expenses for such calendar
year if Landlord  determines that the Excess Expenses are greater than those set forth in
the original Estimate  Statement (or previously  delivered  revised Estimate  Statement)
for such calendar year. The Excess Expenses shown on the Estimate  Statement (or revised
 Estimate  Statement,  as applicable)  shall be divided into twelve (12) equal monthly
 installments,  and Tenant shall pay to Landlord,  concurrently  with the regular
 monthly  rent payment  next due  following  the receipt of the  Estimate  Statement  (or
revised  Estimate Statement,  as applicable),  an amount equal to one (1) monthly
 installment of such Excess Expenses  multiplied by the number of months from  January in
the calendar  year in which such  statement is submitted to the month of such payment,
 both  months  inclusive  (less any  amounts  previously  paid by Tenant  with  respect
to any  previously delivered  Estimate  Statement or revised  Estimate  Statement for
such  calendar  year).  Subsequent  installments shall be paid  concurrently  with the
regular  monthly rent payments for the balance of the calendar year and shall continue
 until  the next  calendar  year's  Estimate  Statement  (or  current  calendar  year's
 revised  Estimate Statement) is received.

4.7     Actual
 Statement.  By the first day of April of each  succeeding  calendar  year  during the
Term of this Lease or as soon  thereafter  as  reasonably  possible,  Landlord  shall
 endeavor to deliver to Tenant a statement (Actual  Statement) of the actual Operating
 Expenses and Excess Expenses for the immediately  preceding calendar year.  If the
Actual

-4-

---

Statement  reveals that Excess
 Expenses were  over-stated  or  under-stated  in any Estimate Statement (or revised
Estimate  Statement)  previously  delivered by Landlord  pursuant to Section 4.6  above,
then within  thirty (30) days after  delivery of the Actual  Statement,  Tenant  shall
pay to Landlord the amount of any such  under-payment,  or,  Landlord  shall credit
 Tenant  against the next monthly rent falling due, the amount of such  over-payment,  as
the  case  may be.  Such  obligation  will be a  continuing  one  which  will  survive
 the expiration or earlier  termination of this Lease.  Prior to the expiration or sooner
 termination of the Lease Term and  Landlord's  acceptance  of Tenant's  surrender of the
 Premises,  Landlord will have the right to estimate the actual  Operating  Expenses  for
the then  current  calendar  year and to collect  from  Tenant  prior to  Tenants
surrender of the Premises,  Tenants  Percentage of any excess of such actual Operating
Expenses over the estimated Operating Expenses paid by Tenant in such calendar year.

4.8     No
Release.  Any delay or failure by Landlord in delivering any Estimate or Actual
 Statement  pursuant to this  Section 4  shall not constitute a waiver of its right to
receive  Tenant's  payment of Excess  Expenses,  nor shall it relieve Tenant of its
 obligations to pay Excess Expenses  pursuant to this Section 4,  except that Tenant
shall not be obligated to make any payments  based on such  Estimate or Actual  Statement
 until ten (10)  business days after receipt of such statement.

4.9     Audit
Rights.  In the event Tenant  disputes the amount of the Operating  Expenses set forth in
the Actual Statement for the particular  calendar year delivered by Landlord to Tenant
pursuant to Section 4.7  above,  Tenant shall  have the right,  at  Tenants  cost,
 after  reasonable  notice to  Landlord,  to have  Tenants  authorized employees or
agents  inspect,  at Landlords  office during normal business hours,  Landlords  books,
 records and supporting  documents  concerning the Operating  Expenses set forth in such
Actual  Statement;  provided,  however, Tenant shall have no right to conduct such
 inspection,  have an audit  performed  by the  Accountant  as described below,  or
object to or  otherwise  dispute  the  amount of the  Operating  Expenses  set forth in
any such  Actual Statement,  unless Tenant notifies Landlord of such objection and
dispute,  completes such inspection,  and has the Accountant  commence and complete such
audit within six (6) months  immediately  following  Landlords  delivery of the
particular Actual Statement in question (the Review Period);  provided,  further,  that
 notwithstanding  any such timely  objection,  dispute,  inspection,  and/or audit, and
as a condition  precedent to Tenants exercise of its right of objection,  dispute,
 inspection  and/or audit as set forth in this  Section 4.9,  Tenant shall not be
permitted to withhold  payment of, and Tenant  shall  timely pay to  Landlord,  the full
amounts as required by the provisions of this  Section 4 in accordance  with such Actual
 Statement.  However,  such payment may be made under protest  pending  the  outcome of
any audit  which may be  performed  by the  Accountant  as  described  below.  In
connection with any such inspection by Tenant,  Landlord and Tenant shall  reasonably
 cooperate with each other so that such inspection can be performed  pursuant to a
mutually  acceptable  schedule,  in an expeditious  manner and without  interference
 with Landlords  operation and management of the Building.  If after such inspection
 and/or request for  documentation,  Tenant  still  disputes the amount of the  Operating
 Expenses set forth in the Actual Statement,  Tenant  shall  have the right,  within the
Review  Period,  to cause an  independent  certified  public accountant  which is not
paid on a  contingency  basis and which is mutually  approved by Landlord  and Tenant
(the Accountant)  to complete an audit of Landlords books and records  pertaining to
Operating  Expenses to determine the proper amount of the Operating  Expenses  incurred
and amounts payable by Tenant for the calendar year which is the subject of such Actual
 Statement.  Such audit by the  Accountant  shall be final and binding upon Landlord and
Tenant.  If Landlord and Tenant  cannot  mutually  agree as to the identity of the
 Accountant  within  thirty (30) days after Tenant  notifies  Landlord that Tenant
desires an audit to be performed,  then the  Accountant  shall be one of the Big 4
accounting  firms,  which is not paid on a contingency basis and which is selected by
Tenant and reasonably  approved by Landlord.  If such audit reveals that Landlord has
over-charged  Tenant, then within thirty (30) days after the results of such audit are
made available to Landlord,  Landlord  shall  reimburse to Tenant the amount of such
over-charge.  If the audit reveals that the Tenant was  under-charged,  then within
thirty (30) days after the results of such audit are made  available  to Tenant,  Tenant
 shall  reimburse to Landlord the amount of such  under-charge.  Tenant  agrees  to pay
the  cost of such  audit  unless  it is  subsequently  determined  that Landlords
 original Actual Statement which was the subject of such audit was in error to Tenants
 disadvantage by five  percent  (5%) or more of the total  Operating  Expenses  which was
the subject of such audit.  The payment by Tenant of any amounts  pursuant to this Section 4
 shall not preclude  Tenant from  questioning  the correctness of any Actual  Statement
 provided  by Landlord  at any time  during the Review  Period,  but the failure of
Tenant to object  thereto,  conduct and complete its  inspection  and have the
 Accountant  conduct and complete the audit as described  above prior to the expiration
of the Review Period shall be  conclusively  deemed  Tenants  approval of the Actual
 Statement  in question and the amount of Operating  Expenses  shown  thereon.  In
 connection  with any inspection and/or audit conducted by Tenant pursuant to this
 Section 4.9,  Tenant agrees to keep, and to cause all of Tenants  employees and
 consultants  and the  Accountant to keep,  all of Landlords  books and records and the
audit, and all information  pertaining thereto and the results thereof,  strictly
 confidential,  and in connection therewith,  Tenant  shall  cause such  employees,
 consultants  and the  Accountant  to execute  such  commercially reasonable
 confidentiality  agreements  as Landlord may require prior to conducting  any such
 inspections  and/or audits.

4.10     Cap on
Controllable  Expenses. Notwithstanding  anything to the contrary  contained in this
Section 4 and commencing as of January 1, 2006, Landlord acknowledges and agrees that the
aggregate  Controllable  Expenses (as hereinafter  defined)  included in Operating
 Expenses in any calendar  year after the 2005 calendar year shall not increase by more
than five  percent  (5%) over the actual  aggregate  Controllable  Expenses  included in
Operating Expenses for any preceding  calendar year  (including the 2005 Base Year),  but
with no such limit on the amount of Controllable  Expenses which may be included in the
Operating  Expenses  incurred during the 2005 Base Year because such 2005 Base Year is
the determination  year with respect to Operating  Expenses (and the determination year
with respect to  Controllable  Expenses).  For  purposes of this  Section 4.9,
 Controllable  Expenses  shall mean all Operating  Expenses  except:  (i) Real
 Property  Taxes and  Assessments;  (ii)  utilities  costs;  (iii) insurance carried by
Landlord with respect to the Project and/or the operation  thereof;  and (iv) wages,
 salaries and other compensation  and  benefits  paid  to  Landlords  employees,  agents
 or  contractors  engaged  in the  operation, management,  maintenance  (including,  but
not limited to,  janitorial  and  cleaning  services) or security of the Building or
Project,  to the extent such wages,  salaries and other  compensation are incurred as a
result of union labor or  government  mandated  requirements  including,  but not
 limited  to,  prevailing  wage laws and  similar requirements.

-5-

---

5.     Security
 Deposit.  Landlord  and Tenant  acknowledge  and agree that  Landlord is, as of the date
hereof, holding an amount equal to Thirty-One  Thousand Dollars  ($31,000.00) as the
security deposit (Existing  Deposit) under that certain office lease dated  January 22,
 1997 by and between Landlord (as  successor-in-interest  in the lease to the prior
 landlord) and Tenant (as amended,  the  Existing  Lease).  On the date of the full
 execution and  delivery of this Lease by  Landlord  and  Tenant,  such  Existing
 Deposit  (less any amounts of the  Existing Deposit  applied by Landlord to remedy any
default by Tenant under the  Existing  Lease)  shall be  transferred  by Landlord so that
the Existing  Deposit (or portion  thereof)  shall  constitute  a portion of the Security
 Deposit required  hereunder.  Concurrently  with Tenant's  execution  and delivery of
this Lease to Landlord,  Tenant shall deposit with  Landlord  the  difference  (i.e.,
 $4,273.92  as of the date  hereof)  between the  Security  Deposit required  hereunder
 and the actual  amount of the Existing  Deposit  under the Existing  Lease so
 transferred  by Landlord.  The Security  Deposit  shall be held by Landlord as security
for the full and  faithful  performance  by Tenant of all of the terms,  covenants  and
 conditions of this Lease to be performed by Tenant during the Term. If Tenant  defaults
with respect to any of its obligations  under this Lease,  Landlord may (but shall not be
required to) use,  apply or retain all or any part of the  Security  Deposit for the
payment of any rent or any other sum in default,  or for the payment of any other
 amount,  loss or damage  which  Landlord  may spend,  incur or suffer by reason of
Tenants  default.  If any portion of the Security  Deposit is so used or applied,
 Tenant shall,  within ten (10) days after demand  therefor,  deposit cash with  Landlord
in an amount  sufficient to restore the Security Deposit to its original  amount.
 Landlord  shall not be required to keep the Security  Deposit  separate  from its
general  funds,  and Tenant  shall not be  entitled  to interest on the  Security
 Deposit.  If Landlord  sells its interest in the Building  during the Term and if
Landlord  deposits  with the  purchaser  the Security  Deposit (or balance  thereof),
 and such  purchaser  acknowledges  receipt  thereof,  then,  upon such sale,  Landlord
shall be discharged  from any further  liability with respect to the Security  Deposit.
 Tenant hereby waives the provisions of Section 1950.7  of the California Civil Code, and
all other provisions of law, now or hereafter in force,  which provide that Landlord may
claim from a security  deposit only those sums  reasonably  necessary to remedy  defaults
in the payment of rent, to repair  damage caused by Tenant or to clean the Premises,  it
being agreed that Landlord may, in  addition,  claim those sums  reasonably  necessary
 to  compensate  Landlord for any other loss or damage, foreseeable  or  unforeseeable,
 caused by the act or  omission  of Tenant or any  Tenant  Parties  (as  defined in
Section 6.4  below).  Within  sixty (60) days after the  expiration  of the Term,  and
 provided  Tenant  fully and faithfully  performs every provision of this Lease,  the
Security  Deposit or any balance thereof shall be returned to Tenant (or, at  Landlord's
 option,  to Tenants  Transferee,  as such term is defined in  Section 14  below),
provided that  subsequent to the  expiration of this Lease,  Landlord may retain from
said Security  Deposit (i) an amount  reasonably  estimated by Landlord to cover
potential  Operating  Expense  reconciliation  payments due with respect to the  calendar
 year in which this Lease  terminates  or expires  (and any  amounts so  retained  and
not applied to such  reconciliation  shall be returned to Tenant  within sixty (60) days
after  Landlords  delivery of the Statement  for such  calendar  year),  (ii) any and
all amounts  reasonably  estimated by Landlord to cover the anticipated  costs to be
incurred by Landlord to remove any signage  provided to Tenant under this Lease, to
remove cabling and other items  required to be removed by Tenant under this Lease and to
repair any damage  caused by such removal (in which case any excess  amount so retained
by  Landlord  shall be returned to Tenant  within  sixty (60) days after such removal and
repair), and (iii) any and all amounts permitted by law or this Section 5.

6.     Use.

6.1     General.
 Tenant shall use the Premises  solely for the  Permitted Use  specified in  Section 1.12
 of the Summary,  and shall not use or permit  the  Premises  to be used for any other
use or  purpose  whatsoever.  Tenant shall  observe and comply with the Rules and
 Regulations  attached  hereto as  Exhibit E,  and all  reasonable non-discriminatory
 modifications  thereof and additions thereto from time to time put into effect and
furnished to Tenant by  Landlord.  Landlord  shall  endeavor to enforce the Rules and
 Regulations,  but shall have no liability to Tenant for the  violation or
 non-performance  by any other tenant or occupant of the Project or the Building of any
such  Rules  and  Regulations.  Tenant  shall,  at its sole  cost and  expense,  observe
 and  comply  with all requirements of any board of fire  underwriters or similar body
relating to the Premises,  all recorded  covenants, conditions  and  restrictions  now or
hereafter  affecting the Premises and all laws,  statutes,  codes,  rules and regulations
 now or hereafter in force  relating to or affecting  the  condition,  use,  occupancy,
 alteration  or improvement  of the Premises,  including,  without  limitation,  the
 provisions of Title III of the Americans with Disabilities  Act of 1990 as it pertains
to Tenant's use,  occupancy,  improvement  and  alteration of the Premises (whether,
except as otherwise expressly provided herein,  structural or nonstructural,  including
unforeseen and/or extraordinary  alterations and/or  improvements to the Premises,
 regardless of the period of time remaining in the Lease  Term).  Tenant shall not use or
allow the  Premises to be used (a) in  violation of any recorded  covenants, conditions
 and  restrictions  affecting  the  Site or of any law or  governmental  rule or
 regulation,  or of any certificate  of occupancy  issued for the  Premises or  Building,
 or (b) for any  improper,  immoral,  unlawful or reasonably  objectionable  purpose.
 Tenant  shall not do or permit to be done  anything  which  will  obstruct  or interfere
 with the rights of other tenants or occupants of the Project or the  Building,  or
injure or annoy them. Tenant shall not cause,  maintain or permit any nuisance in, on or
about the Premises,  the  Building,  the Project or the Site, nor commit or suffer to be
committed any waste in, on or about the Premises.

6.2     Parking.

|(a) | Tenants
Parking  Privileges.  During the Term of this Lease,  Landlord shall lease to Tenant,
 and Tenant          shall lease from  Landlord,  the number of parking  privileges
 specified in  Section 1.16  of the Summary          hereof for use by Tenants
 employees in the common parking areas for the Building within the Project,  as
         designated  by Landlord  from time to time.  Landlord  shall at all times have
the right to establish  and          modify the nature and extent of the parking  areas
for the  Building and Project  (including  whether such          areas shall be surface,
 underground  and/or other structures) as long as Tenant is provided the number of
         parking  privileges  designated in  Section 1.16  of the Summary.  In addition,
 Landlord may, in its sole          discretion,  assign any  unreserved  and unassigned
 parking  privileges,  and/or make all or a portion of          such privileges reserved.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | Visitor
 Parking.  In addition to such parking  privileges for use by Tenants  employees,
 Landlord shall          permit access to the parking areas for Tenants  visitors,
 subject to  availability of spaces and payment          (by validation
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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---

| | charges
or otherwise) of daily visitor parking charges  therefor as may be established and
         adjusted by Landlord from time to time.
| | -------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Parking
 Rules.  The use of the  parking  areas  shall be subject  to the  Parking  Rules and
 Regulations          contained  in  Exhibit E  attached  hereto  and  any  other
 reasonable,  non-discriminatory  rules  and          regulations  adopted by Landlord
 and/or  Landlord's  parking  operators from time to time,  including any          system
for controlled  ingress and egress and charging visitors and invitees,  with appropriate
 provision          for  validation  of such  charges.  Tenant shall not use more parking
 privileges  than its  allotment and          shall not use any parking  spaces
 specifically  assigned by Landlord to other  tenants of the Building or          Project
or for such other uses as visitor  parking.  Tenant's  parking  privileges  shall be used
only for          parking by vehicles no larger than normally sized passenger
 automobiles or pick-up  trucks.  Tenant shall          not  permit or allow any
 vehicles  that  belong to or are  controlled  by Tenant or  Tenants  employees,
         suppliers,  shippers,  customers or invitees to be loaded,  unloaded,  or parked
in areas other than those          designated  by  Landlord  for  such  activities.  If
 Tenant  permits  or  allows  any of  the  prohibited          activities  described
 herein,  then Landlord shall have the right,  without  notice,  in addition to such
         other  rights and  remedies  that it may have,  to remove or tow away the
vehicle  involved and charge the          cost thereof to Tenant, which cost shall be
immediately payable by Tenant upon demand by Landlord.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6.3     Signs
and  Auctions.  Tenant  shall be entitled,  at its sole cost and  expense,  to maintain
the existing identification  signs on or near the entry  doors of the  Premises  covered
 under this  Lease.  Such sign shall be installed by a signage  contractor  designated by
Landlord.  The location,  quality,  design,  style,  lighting and size of such sign shall
be consistent with the Landlords  Building  standard  signage program and shall be
subject to Landlords prior written  approval,  in its reasonable  discretion.  Upon the
expiration or earlier  termination of this Lease, Tenant shall be responsible,  at its
sole cost and expense,  for the removal of such signage and the repair of all damage to
the Building caused by such removal.  Except for such  identification  sign, Tenant may
not install any signs on the  exterior  or roof of the  Building or the common  areas of
the  Building or the  Project. Except for Tenants Name Sign (as defined  below),  any
signs,  window  coverings,  or blinds (even if the same are located behind the Landlord
 approved window coverings for the Building),  or other items visible from the exterior
of the Premises or Building are subject to the prior  approval of  Landlord,  in its sole
and absolute  discretion. Tenant  shall have no right to conduct any  auction  in, on or
about the  Premises,  the  Building or Site.  Tenant shall, at Tenants expense,
 continue to be entitled to one (1) line on the Building  directory to display Tenants
name and suite number.

|(a) | Monument
 Signage.   Subject  to  the  continued  approval  of  all  applicable  governmental  and
 quasi-          governmental  entities,  and subject to all applicable  governmental and
quasi-  governmental laws, rules,          regulations  and  codes,  Tenant  shall
 continue  to be  entitled  to retain the  non-exclusive  right to          maintain its
 identification  sign  (Tenants  Name Sign) located on the  Building's  monument sign
(the  Monument  Sign).  Tenant shall pay to Landlord,  within ten (10) days
after  demand,  from time to time,          all costs  attributable  to the  maintenance
 and  repair of  Tenant's  Name  Sign on the  Monument  Sign.          Landlord  shall
have the right to relocate,  redesign  and/or  reconstruct  the Monument Sign from time
to          time.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | General
 Provisions.  The signage  rights  granted to Tenant  under this  Section 6.3  are
personal to the          original Tenant executing this Lease  (Original  Tenant) and
may not be exercised or used by or assigned          to any other  person or entity.  In
addition,  Original  Tenant shall no longer have any right to Tenants          Name Sign
if at any time  during the Lease Term the  Original  Tenant does not lease and occupy all
of the          Premises.  Upon the  expiration or sooner  termination of this Lease,  or
upon the earlier  termination of          Tenant's  signage rights  hereunder,  Landlord
shall have the right to  permanently  remove  Tenants Name          Sign and to repair
all damage to the Building,  the Monument Sign and/or the Project  resulting  from such
         removal,  and Tenant  shall  reimburse  Landlord  for  Landlords  costs
 thereof  within ten (10) days of          Landlords demand.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6.4     Hazardous
 Materials.  Tenant will  (i) obtain  and  maintain  in full force and effect all
 Environmental Permits (as defined below) that may be required from time to time under
any  Environmental  Laws (as defined below) applicable to Tenant or the Premises and (ii) be
and remain in  compliance in all material  respects with all terms and  conditions  of
all such  Environmental  Permits  and with all  other  limitations,  restrictions,
 conditions, standards,  prohibitions,  requirements,  obligations, schedules and
timetables contained in all Environmental Laws applicable  to  Tenant  or the  Premises.
 As used in this  Lease,  the term  Environmental  Law  means any past, present or
future federal,  state,  local or foreign statutory or common law, or any regulation,
 ordinance,  code, plan,  order,  permit,  grant,  franchise,  concession,  restriction
or agreement issued,  entered,  promulgated or approved  thereunder,  relating to (a) the
 environment,  human health or safety,  including,  without  limitation, emissions,
 discharges,  releases  or  threatened  releases of  Hazardous  Materials  (as  defined
 below) into the environment  (including,  without  limitation,  air, surface water,
 groundwater or land), or (b) the  manufacture, generation,  refining,  processing,
 distribution,  use, sale, treatment,  receipt, storage,  disposal,  transport, arranging
for transport,  or handling of Hazardous  Materials.  Environmental  Permits means,
 collectively,  any and all permits,  consents,  licenses,  approvals and registrations
of any nature at any time required pursuant to, or in order to comply  with,  any
 Environmental  Law.  Except for ordinary and general  office  supplies,  such as copier
 toner,  liquid  paper,  glue,  ink and  common  household  cleaning  materials  (some or
all of  which  may constitute  Hazardous  Materials  as defined in this Lease),  Tenant
 agrees not to cause or permit any Hazardous Materials to be brought upon,  stored,
 used,  handled,  generated,  released or disposed of on, in, under or about the
 Premises,  the  Building,  the Common  Areas or any other  portion  of the  Project  by
 Tenant,  its  agents, employees, subtenants,  assignees, licensees,  contractors or
invitees (collectively,  Tenants Parties), without the prior written  consent of
Landlord,  which consent  Landlord may withhold in its sole and absolute  discretion.
Upon the expiration or earlier termination of this Lease,  Tenant agrees to promptly
remove from the Premises,  the Building and the Project, at its sole cost and expense,
 any and all Hazardous  Materials,  including any equipment or systems containing
 Hazardous Materials which are installed,  brought upon, stored,  used, generated or
released upon, in, under or about the Premises,  the Building  and/or the Project or any
portion thereof by Tenant or any of Tenants  Parties.  To the fullest extent permitted
by law, Tenant agrees to promptly  indemnify,  protect,  defend and hold harmless
 Landlord and  Landlords  partners,  officers,  directors,  employees,  agents,
 successors  and assigns  (collectively,

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---

Landlord Indemnified Parties)
from and against any and all claims,  damages,  judgments, suits,  causes  of  action,
 losses,  liabilities,   penalties,  fines,  expenses  and  costs  (including,  without
limitation,  clean-up,  removal,  remediation and restoration costs, sums paid in
settlement of claims,  attorneys fees,  consultant  fees and expert  fees and court
 costs)  which arise or result  from the  presence of  Hazardous Materials  on, in,
 under or about the  Premises,  the  Building or any other  portion of the Project and
which are caused or  permitted  by Tenant or any of  Tenants  Parties.  Tenant  agrees
to  promptly  notify  Landlord of any release of Hazardous  Materials in the  Premises,
 the  Building or any other  portion of the Project  which Tenant becomes  aware of
during the Term of this Lease,  whether  caused by Tenant or any other  persons or
 entities.  In the event of any  release  of  Hazardous  Materials  caused or  permitted
 by  Tenant or any of  Tenants  Parties, Landlord  shall have the right,  but not the
 obligation,  to cause Tenant , at Tenant's sole cost and expense,  to immediately  take
all steps  Landlord  deems  necessary or  appropriate  to remediate  such release and
prevent any similar future release to the  satisfaction of Landlord and Landlord's
 mortgagee(s).  At all times during the Term of this  Lease,  Landlord  will have the
right,  but not the  obligation,  to enter upon the  Premises  to inspect, investigate,
 sample  and/or  monitor the Premises to determine if Tenant is in  compliance  with the
terms of this Lease  regarding  Hazardous  Materials.  Tenant  will,  upon the request of
Landlord or any  mortgagee  at any time during which Tenant is in default under this
Lease,  cause to be performed an  environmental  audit of the Premises at Tenants
 expense by an  established  environmental  consulting  firm  reasonably  acceptable  to
 Landlord  and Landlords  mortgagee(s).  As used in this  Lease,  the term Hazardous
 Materials  shall  mean and  include  any hazardous or toxic materials,
 substances or wastes as now or hereafter  designated under any  Environmental  Laws,
including,  without limitation,  asbestos,  petroleum,  petroleum  hydrocarbons and
petroleum based products,  urea formaldehyde foam insulation,  polychlorinated  biphenyls
(PCBs"\),  and freon and other  chlorofluorocarbons.  The provisions
of this Section 6.4 will survive the expiration or earlier termination of this Lease.

7.     Payments
and Notices.  All rent and other sums  payable by Tenant to Landlord  hereunder  shall be
paid to Landlord at the address  designated in  Section 1.1  of the Summary,  or to such
other persons and/or at such other places as Landlord may  hereafter  designate  in
writing.  Any notice  required or permitted to be given  hereunder must be in writing and
may be given by personal delivery  (including  delivery by nationally  recognized
 overnight courier or express mailing service),  facsimile  transmission sent by a
machine capable of confirming  transmission receipt,  with a hard  copy of  such  notice
 delivered  no  later  than  one  (1)  business  day  after  facsimile transmission by
another method  specified in this Section 7,  or by registered or certified mail,
 postage prepaid, return receipt requested,  addressed to Tenant at the address(es)
 designated in Section 1.2 of the Summary,  or to Landlord at the address  designated in
 Section 1.1  of the Summary.  Either party may, by prior written  notice to the other,
 specify a different  address for notice purposes.  Notice given in the foregoing manner
shall be deemed given (i) upon  confirmed  transmission if sent by facsimile
 transmission,  provided such transmission is prior to 5:00 p.m.  on a business day (if
such  transmission  is after  5:00 p.m.  on a business day or is on a non-business day,
such notice will be deemed given on the following  business day),  (ii) when  actually
 received or refused by the party to whom sent if  delivered by a carrier or  personally
 served or (iii) if  mailed,  on the day of actual delivery or refusal as shown by the
 certified  mail return  receipt or the  expiration  of three (3) business days after the
day of mailing,  whichever  first  occurs.  For purposes of this  Section 7,  a business
 day is Monday through Friday, excluding holidays observed by the United States Postal
Service.

8.     Brokers.
 Landlord has entered into an agreement  with the real estate  broker  specified in
 Section 1.13 of the Summary as  representing  Landlord  (Landlords  Broker),  and
Landlord shall pay any  commissions or fees that are payable to Landlord's  Broker with
respect to this Lease in accordance  with the  provisions of a separate commission
 contract.  Landlord shall have no further or separate  obligation for payment of
commissions or fees to any other real estate  broker,  finder or  intermediary.  Tenant
 represents  that it has not had any dealings with any real estate broker,  finder or
intermediary  with respect to this Lease,  other than Landlords  Broker and the broker
 specified in Section 1.13 of the Summary as representing  Tenant  (Tenants  Broker).
 Any commissions or fees payable to Tenant's  Broker with respect to this Lease shall be
paid  exclusively by Landlords  Broker.  Each party  represents  and  warrants  to the
 other,  that,  to  its  knowledge,  no  other  broker,  agent  or  finder (a) negotiated
or was instrumental in negotiating or consummating this Lease on its behalf,  and (b) is
or might be entitled to a commission or compensation in connection with this Lease.
 Tenant shall  indemnify,  protect,  defend (by counsel  reasonably  approved in writing
by Landlord) and hold  Landlord  harmless from and against any and all claims,
 judgments,  suits, causes of action, damages, losses,  liabilities and expenses
(including attorneys' fees and  court  costs)  resulting  from any  breach  by  Tenant of
the  foregoing  representation,  including,  without limitation,  any claims that may be
asserted against Landlord by any broker,  agent or finder undisclosed by Tenant herein.
 Landlord shall indemnify,  protect,  defend (by counsel reasonably approved in writing
by Tenant) and hold Tenant  harmless  from and  against  any and all  claims,  judgments,
 suits,  causes of action,  damages,  losses, liabilities and expenses  (including
 attorneys' fees and court costs) resulting from any breach by Landlord of the foregoing
 representation,  including,  without  limitation,  any claims that may be asserted
against Tenant by any broker,  agent or finder  undisclosed by Landlord herein.  The
foregoing  indemnities  shall survive the expiration or earlier termination of this Lease.

9.     Surrender;
Holding Over.

9.1     Surrender
of Premises.  Upon the expiration or sooner  termination of this Lease,  Tenant shall
 surrender all keys for the Premises to Landlord,  and  exclusive  possession  of the
Premises to Landlord  broom clean and in first-class  condition and repair,  reasonable
wear and tear excepted,  with all of Tenant's personal property (and those items,  if
any, of Tenant  Improvements  and Tenant Changes  identified by Landlord  pursuant to
Section 12.2 below) removed  therefrom and all damage caused by such removal  repaired,
 as required  pursuant to  Sections 12.2 and 12.3  below.  If,  for any  reason,  Tenant
 fails to  surrender  the  Premises  on the  expiration  or earlier termination of this
Lease (including upon the expiration of any subsequent  month-to-month  tenancy consented
to by Landlord pursuant to Section 9.2 below), with such removal and repair obligations
 completed,  then, in addition to the  provisions  of  Section 9.3  below  and
 Landlords  rights  and  remedies  under  Section 12.4  and the other provisions of this
Lease,  Tenant shall  indemnify,  protect,  defend (by counsel  approved in writing by
Landlord) and hold  Landlord  harmless  from and against any and all claims,  judgments,
 suits,  causes of action,  damages, losses,  liabilities  and  expenses  (including
 attorneys  fees and court costs)  resulting  from such failure to surrender,
 including,  without  limitation,  any claim made by any succeeding tenant based thereon.
 The foregoing indemnity shall survive the expiration or earlier termination of this
Lease.

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---

9.2     Hold
Over With  Landlords  Consent.  If, with  Landlords  express  written  consent,  Tenant
 remains in possession of the Premises  after the expiration or earlier  termination  of
the Lease Term,  Tenant shall become a tenant from  month-to-month  upon the terms and
conditions set forth in this Lease (including  Tenants  obligation to pay all Excess
Expenses and any other  additional  rent under this Lease),  but at a Monthly Basic Rent
equal to the  greater of:  (a) one  hundred  fifty  percent  (150%) of the Monthly  Basic
Rent  applicable  to the  Premises immediately  prior to the date of such expiration or
earlier  termination;  or (b) one hundred fifty percent (150%) of the  prevailing  market
rate (as  reasonably  determined  by Landlord) for the Premises in effect on the date of
such  expiration  or earlier  termination.  Tenant shall pay an entire  months  Monthly
 Basic Rent  calculated in accordance  with this  Section 9.2  for any  portion of a
month it holds  over and  remains  in  possession  of the Premises  pursuant  to this
 Section 9.2.  This  Section 9.2  shall not be  construed  to create any  expressed  or
implied right to holdover beyond the expiration of the Lease Term or any extension
thereof.

9.3     Hold
Over Without  Landlord's  Consent.  If Tenant holds over after the expiration or earlier
 termination of the Lease Term  without  the express  written  consent of  Landlord,
 then,  in  addition to all other  remedies available to Landlord,  Tenant shall become a
tenant at sufferance  only,  upon the terms and  conditions set forth in this  Lease so
far as  applicable  (including  Tenant's  obligation  to pay all  Excess  Expenses  and
any other additional  rent under this Lease),  but at a Monthly  Basic Rent equal to the
greater of:  (a) one  hundred  fifty percent  (150%)  of the  Monthly  Basic  Rent
 applicable  to the  Premises  immediately  prior to the date of such expiration  or
earlier  termination;  or (b) one  hundred fifty percent  (150%) of the  prevailing
 market rate (as reasonably  determined  by  Landlord)  for the  Premises  in  effect  on
the  date of such  expiration  or  earlier termination.  Acceptance by Landlord of rent
after such  expiration or earlier  termination  shall not constitute a consent to a hold
over  hereunder  or result in an  extension  of this Lease.  Tenant  shall pay an entire
 month's Monthly  Basic Rent  calculated in accordance  with this  Section 9.3  for any
portion of a month it holds over and remains in possession of the Premises pursuant to
this Section 9.3.

9.4     No
Effect on  Landlord's  Rights.  The foregoing  provisions of this  Section 9 are in
addition to, and do not affect,  Landlords  right of re-entry or any other rights of
Landlord  hereunder or otherwise  provided by law or equity.

10.     Taxes on
Tenant's Property.  Tenant shall be liable for, and shall pay before  delinquency,  all
taxes and assessments  (real and personal) levied against (a) any personal  property or
trade fixtures placed by Tenant in or about the Premises  (including  any increase in the
assessed value of the Premises based upon the value of any such personal  property or
trade  fixtures);  and (b) any Tenant  Improvements  or alterations in the Premises
 (whether installed  and/or paid for by Landlord or Tenant) to the extent such items are
assessed at a valuation  higher than the  valuation  at which  tenant  improvements
 conforming  to the  Building's  standard  tenant  improvements  are assessed.  If any
such taxes or  assessments  are levied  against  Landlord or Landlords  property,
 Landlord may, after written  notice to Tenant,  pay such taxes and  assessments,  and
Tenant shall  reimburse  Landlord  therefor within ten (10) days after demand by Landlord.

11.     Condition
of Premises; Repairs.

11.1     Condition
 of  Premises.  Tenant  acknowledges  and agrees that it has had an  opportunity  to
inspect the Premises,  the  Building,  the Site and the  Project,  and finds the same in
 satisfactory  condition  and  repair. Tenant  accepts the  Premises,  the  Building,
 the Site and the Project in their then as-is  condition as of the date  hereof.
 Tenant also  acknowledges  that,  except as  otherwise  expressly  set forth in this
Lease,  neither Landlord nor any agent of Landlord  has made any  representation  or
warranty  with  respect to the  Premises,  the Building,  the Site or the Project or
their condition,  or with respect to the suitability  thereof for the conduct of Tenants
 business.  The taking of possession of the Premises by Tenant shall  conclusively
 establish  that the Project,  the Site, the Premises,  the Tenant Improvements  therein,
the Building and the Common Areas were at such time complete and in good,  sanitary and
 satisfactory  condition and repair with all work required to be performed by Landlord,
 if any,  pursuant to Exhibit C  completed and without any obligation on Landlords
part to make any alterations, upgrades or improvements thereto.

11.2     Landlord's
 Repair  Obligations.  Subject to Section 18.1 and 18.2 of this Lease,  Landlord shall,
as part of the Operating Expenses,  repair,  maintain and replace, as necessary (a) the
Building shell and other structural portions  of  the  Building  (including  the  roof
 and  foundations),  (b) the  basic  heating,  ventilating,  air conditioning  (HVAC),
 sprinkler  and  electrical  systems  within  the  Building  core  and  standard
 conduits, connections  and  distribution  systems  thereof  within  the  Premises  (but
not any above  standard  improvements installed  in the  Premises  such  as,  for
 example,  but  by  way of  limitation,  custom  lighting,  special  or supplementary
 HVAC or plumbing systems or distribution  extensions,  special or supplemental
 electrical panels or distribution  systems,  or kitchen  or  restroom  facilities  and
 appliances  to the extent  such  facilities  and appliances  are intended for the
exclusive use of Tenant),  and (c) the  Common Areas;  provided,  however,  to the extent
such maintenance,  repairs or replacements are required as a result of any act,  neglect,
 fault or omission of Tenant or any of Tenants agents, employees,  contractors,
 licensees or invitees, Tenant shall pay to Landlord, as additional  rent,  the costs of
such  maintenance,  repairs and  replacements.  Landlord  shall not be liable to Tenant
for failure to perform any such  maintenance,  repairs or  replacements,  unless Landlord
shall fail to make such  maintenance,  repairs or  replacements  and such failure shall
 continue for an  unreasonable  time following written notice from Tenant to Landlord of
the need  therefor.  Without  limiting the  foregoing,  Tenant waives the right to make
 repairs at  Landlord's  expense  under any law,  statute or  ordinance  now or
 hereafter  in effect (including  the  provisions of California  Civil Code  Section 1942
 and any  successive  sections or statutes of a similar nature).

11.3     Tenants
Repair Obligations.  Except for Landlords  obligations  specifically set forth in
Sections 11.1, 11.2,  16.1,  18.1 and 19.2  hereof,  Tenant  shall at all  times and at
 Tenant's  sole  cost and  expense,  keep, maintain,  clean,  repair,  preserve and
replace,  as  necessary,  the  Premises and all parts  thereof  including, without
 limitation,  all Tenant  Improvements,  Tenant Changes,  utility meters,  all special or
supplemental HVAC systems,  electrical  systems,  pipes and  conduits,  located  within
the  Premises,  all  fixtures,  furniture and equipment,  Tenants  storefront (if any),
 Tenants signs,  locks,  closing devices,  security  devices,  windows, window sashes,
casements and frames, floors and floor coverings,  shelving,  kitchen and/or restroom
facilities and appliances  located  within the  Premises  to the extent  such  facilities
 and  appliances  are  intended  for the exclusive use of Tenant,  if any,  custom
 lighting,  and any  alterations,  additions and other

-9-

---

property  located within the
 Premises  in  first-class  condition  and  repair,  reasonable  wear and tear  excepted.
 Tenant  shall replace,  at its expense,  any and all plate and other glass in and about
the  Premises  which is damaged or broken from any cause  whatsoever  except due to the
gross  negligence or willful  misconduct  of Landlord,  its agents or employees  and not
covered by  insurance  maintained,  or  required to be  maintained,  by Tenant
 hereunder.  Such maintenance  and repairs shall be performed  with due  diligence,
 lien-free and in a first-class  and  workmanlike manner, by licensed  contractor(s)
 which are selected by Tenant and approved by Landlord,  which approval Landlord shall
not unreasonably  withhold or delay.  Except as otherwise  expressly  provided in this
Lease,  Landlord shall have no  obligation  to alter,  remodel,  improve,  repair,
 renovate,  redecorate  or paint all or any part of the Premises.

12.     Alterations.

12.1     Tenant
 Changes;  Conditions.  After  installation  of the initial  Tenant  Improvements  for
the Premises pursuant to Exhibit C,  Tenant may, at its sole cost and expense, make
alterations,  additions,  improvements and decorations  to the  Premises  (collectively,
Tenant  Changes)  subject  to and upon  the  following  terms  and conditions:

|(a) | Notwithstanding
 any provision in this  Section 12 to the contrary,  Tenant is absolutely  prohibited
from          making any  alterations,  additions,  improvements or decorations  which:
 (i) affect any area outside the          Premises;   (ii) affect  the  Building's
 structure,   equipment,  services  or  systems,  or  the  proper          functioning
thereof, or Landlord's access thereto;  (iii) affect the outside appearance,  character
or use          of the Project,  the Building or the Common Areas;  (iv) weaken or impair
the  structural  strength of the          Building;  (v) in the  reasonable  opinion of
Landlord,  lessen the value of the Project or  Building;  or          (vi) will violate
or require a change in any occupancy certificate applicable to the Premises.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | Before
 proceeding  with any Tenant Change which is not otherwise  prohibited  in  Section 12.1(a)
 above,          Tenant  must  first  obtain  Landlord's  written  approval  thereof
 (including  approval  of  all  plans,          specifications  and working  drawings for
such Tenant  Change),  which approval shall not be  unreasonably          withheld.
 However,  Landlords  prior  approval  shall  not be  required  for  any  Tenant  Change
 which          satisfies the following  conditions  (hereinafter a Pre-Approved
 Change):  (i) the costs of such Tenant          Change does not exceed One Thousand
 Five Hundred  Dollars  ($1,500.00)  individually;  (ii) the  costs of          such
Tenant Change when  aggregated  with the costs of all other Tenant  Changes made by
Tenant during the          Term of this Lease do not exceed Ten  Thousand  Dollars
 ($10,000.00);  (iii) Tenant  delivers to Landlord          final plans,  specifications
 and working  drawings for such Tenant Change at least ten (10) days prior to
         commencement  of the work thereof;  (iv) the  Tenant Change is not  prohibited
in  Section 12.1(a)  above;          (v) the Tenant Change does not require a building
permit;  and (v) Tenant and such Tenant Change otherwise          satisfy all other
conditions set forth in this Section 12.1.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | After
 Landlord  has  approved  the Tenant  Changes and the plans,  specifications  and
 working  drawings          therefor (or is deemed to have approved the Pre-Approved
 Changes as set forth in Section 12.1(b)  above),          Tenant  shall:  (i) enter
 into an  agreement  for  the  performance  of such  Tenant  Changes  with  such
         contractors and  subcontractors  selected by Tenant and approved by Landlord,
 which approval shall not be          unreasonably  withheld  or  delayed;   (ii) before
 proceeding  with  any  Tenant  Change  (including  any          Pre-Approved  Change),
 provide  Landlord with ten (10) days prior written notice thereof;  and (iii) pay
         to Landlord,  within ten (10) days after written  demand,  the costs of any
increased  insurance  premiums          incurred by Landlord to include such Tenant
Changes in the fire and extended coverage  insurance  obtained          by Landlord
 pursuant to Section 21  below,  if Landlord  elects in writing to insure such Tenant
Changes.          Landlord  shall not be  required  to include  the Tenant  Changes
 under such  insurance.  If such  Tenant          Changes are not  included in
 Landlord's  insurance,  Tenant  shall  insure the Tenant  Changes  under its
         casualty  insurance  pursuant to  Section 20.1(a)  below. In addition,  before
 proceeding with any Tenant          Change,  Tenant's  contractors  shall  obtain,  on
behalf of Tenant and at Tenants sole cost and expense:          (A) all  necessary
 governmental  permits and approvals for the commencement and completion of such Tenant
         Change;  and (B) a completion and lien indemnity bond, or other surety,
 satisfactory to Landlord for such          Tenant  Change.  Landlords  approval  of any
 contractor(s)  and  subcontractor(s)  of  Tenant  shall not          release Tenant or
any such  contractor(s)  and/or  subcontractor(s)  from any liability for any conduct or
         acts of such contractor(s) and/or subcontractor(s).
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | Tenant
shall pay to Landlord,  as additional rent, the reasonable costs of Landlord's  engineers
and other          consultants  (but not Landlords  on-site  management  personnel) for
review of all plans,  specifications          and working  drawings  for the Tenant
 Changes  and for the  incorporation  of such Tenant  Changes in the          Landlord's
 master  Building  drawings,  within ten (10) business days after Tenants  receipt of
invoices          either from Landlord or such  consultants  together with (in any event)
an  administrative  charge of five          percent  (5%) of the actual costs of such
work.  In addition to such costs,  Tenant shall pay to Landlord,          within ten (10)
 business  days after  completion  of any Tenant  Change,  the  actual,  reasonable
 costs          incurred  by  Landlord  for  services  rendered  by  Landlords
 management  personnel  and  engineers  to          coordinate  and/or  supervise any of
the Tenant Changes to the extent such services are provided in excess          of or
after the normal on-site hours of such engineers and management personnel.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(e) | All
Tenant Changes shall be performed:  (i) in  accordance  with the approved  plans,
 specifications  and          working drawings;  (ii) lien-free and in a first-class
 workmanlike  manner;  (iii) in compliance with all          laws, rules, regulations of
all governmental agencies and authorities including,  without limitation,  the
         provisions of Title III of the Americans with  Disabilities  Act of 1990;  (iv) in
such a manner so as not          to  interfere  with the  occupancy  of any  other
 tenant in the  Project  or  Building,  nor  impose  any          additional  expense
upon nor delay Landlord in the  maintenance  and operation of the Project or Building;
         and (v) at such  times,  in such manner and  subject to such rules and
 regulations  as Landlord  may from          time to time reasonably designate.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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---

|(f) | Throughout
 the  performance  of the Tenant  Changes,  Tenant shall obtain,  or cause its
 contractors  to          obtain,  workers compensation  insurance and general liability
insurance in compliance with the provisions          of Section 20 of this Lease.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

12.2     Removal
 of  Tenant  Changes  and  Tenant  Improvements.   All  Tenant  Changes  and  the
 initial  Tenant Improvements in the Premises  (whether  installed or paid for by
Landlord or Tenant),  shall become the property of Landlord  and  shall  remain  upon and
be  surrendered  with  the  Premises  at the end of the Term of this  Lease; provided,
 however,  Landlord  may, by written  notice  delivered  to Tenant at any time prior to
the date which is thirty  (30) days before the  expiration  of the Lease Term (or
 immediately  upon any sooner  termination  of this Lease)  identify  those items of the
Tenant  Improvements  and Tenant Changes  (including,  but not limited to, any voice and
data cabling or other wiring and any pipes  installed by Tenant in the  Building)  which
 Landlord  shall require  Tenant to remove at the end of the Term of this  Lease.  If
 Landlord  requires  Tenant to remove any such items as described above,  Tenant shall,
at its sole cost,  remove the identified items on or before the expiration or sooner
 termination  of this  Lease and  repair  any  damage to the  Premises  caused by such
 removal  (or,  at Landlord's option, shall pay to Landlord all of Landlord's costs of
such removal and repair).

12.3     Removal
of Personal  Property.  All articles of personal  property  owned by Tenant or installed
by Tenant at its expense in the Premises  (including  business and trade fixtures,
 furniture and moveable  partitions) shall be, and remain,  the property of Tenant,  and
shall be removed by Tenant from the  Premises,  at Tenants sole cost and expense,  on or
before the  expiration or sooner  termination of this Lease.  Tenant shall promptly
 repair any damage caused by such removal.

12.4     Tenants
 Failure to Remove.  If Tenant fails to remove by the  expiration or sooner  termination
 of this Lease all of its personal  property,  or any items of Tenant  Improvements or
Tenant Changes identified by Landlord for removal pursuant to Section 12.2  above, or if
Tenant fails to comply with its obligations under  Section 12.3, Landlord may, at its
option,  treat such failure as a hold over pursuant to Section 9.3 above,  and/or may
(without liability  to Tenant for loss  thereof,  at  Tenant's  sole cost and in
 addition to  Landlord's  other  rights and remedies  under this Lease,  at law or in
equity:  (a) remove  and store such items in accordance  with  applicable law;  and/or
 (b) upon ten (10) days prior notice to Tenant,  sell all or any such items at private
or public sale for such price as Landlord may obtain as  permitted  under  applicable
 law.  Landlord  shall apply the proceeds of any such sale to any amounts due to Landlord
under this Lease from Tenant  (including  Landlord's  attorneys  fees and other costs
 incurred in the  removal,  storage  and/or sale of such items),  with any  remainder to
be paid to Tenant.

13.     Liens.
 Tenant shall not permit any  mechanics,  materialmens  or other liens to be filed
against all or any part of the Project,  the Site, the Building or the Premises,  nor
against Tenants  leasehold  interest in the Premises,  by reason of or in connection
with any repairs,  alterations,  improvements or other work contracted for or  undertaken
 by  Tenant or any  other  act or  omission  of Tenant  or any  Tenant  Parties.  Tenant
 shall,  at Landlords  request,  provide Landlord with enforceable,  unconditional and
final lien releases (and other evidence reasonably  requested by Landlord to demonstrate
 protection from liens) from all persons  furnishing  labor and/or materials  with
 respect to the  Premises.  Landlord  shall have the right at all  reasonable  times to
post on the Premises and record any notices of  non-responsibility  which it deems
 necessary for  protection  from such liens. If any such liens are filed,  Tenant shall,
at its sole cost,  immediately cause such lien to be released of record or bonded to
Landlords  reasonable  satisfaction so that it no longer affects title to the Project,
 the Site, the Building or the  Premises.  If Tenant fails to cause such lien to be so
released or bonded  within twenty (20) days after filing  thereof,  Landlord may,
 without  waiving its rights and remedies  based on such breach,  and without releasing
 Tenant from any of its  obligations,  cause such lien to be released by any means it
shall deem  proper, including  payment in  satisfaction  of the claim  giving rise to
such lien.  Tenant  shall pay to Landlord  within five (5) days after  receipt of invoice
 from  Landlord,  any sum paid by Landlord  to remove such liens,  together with
 interest  at the  Interest  Rate from the date of such  payment  by  Landlord.  NOTICE
IS HEREBY  GIVEN  THAT LANDLORD  SHALL NOT BE LIABLE FOR ANY LABOR,  SERVICES OR
MATERIALS  FURNISHED OR TO BE FURNISHED TO TENANT,  OR TO ANYONE  HOLDING THE PREMISES
 THROUGH OR UNDER  TENANT,  AND THAT NO  MECHANICS OR OTHER LIENS FOR ANY SUCH LABOR,
SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE INTEREST OF LANDLORD IN THE PREMISES.

14.     Assignment
and Subletting.

14.1     Restriction
on Transfer.  Except as otherwise  expressly  provided in this  Section 14,  Tenant shall
not, without the prior written consent of Landlord,  which consent Landlord will not
unreasonably withhold,  assign this Lease or any  interest  herein or sublet the
 Premises or any part  thereof,  or permit the use or occupancy of the Premises  by any
party other than Tenant (any such  assignment,  encumbrance,  sublease,  license or the
like shall sometimes  be  referred  to as a  Transfer).  In no event may Tenant
 encumber or  hypothecate  this  Lease.  Any Transfer  without  Landlord's  consent
 (except for a Permitted  Transfer  pursuant to  Section 14.2  below)  shall constitute a
default by Tenant under this Lease,  and in addition to all of  Landlords  other
 remedies at law, in equity or under this Lease,  such  Transfer  shall be voidable at
 Landlords  election.  In  addition,  this Lease shall not, nor shall any interest of
Tenant herein,  be assignable by operation of law without the written  consent of
Landlord.  For purposes of this Section 14,  other than with respect to a Permitted
 Transfer under Section 14.2 and transfers of stock of Tenant if Tenant is a
publicly-held  corporation  and such stock is transferred  publicly over a recognized
 security exchange or over-the-counter  market, if Tenant is a corporation,  partnership
or other entity, any transfer,  assignment,  encumbrance or hypothecation of twenty-five
percent (25%) or more (individually or in the  aggregate) of any stock or other
 ownership  interest in such entity,  and/or any transfer,  assignment, hypothecation  or
encumbrance of any controlling  ownership or voting  interest in such entity,  shall be
deemed an assignment  of this  Lease and  shall be  subject  to all of the  restrictions
 and  provisions  contained  in this Section 14.

14.2     Permitted
 Controlled  Transfers.  Notwithstanding  the provisions of Sections 14.1 above to the
contrary, Tenant may assign this Lease or sublet the  Premises or any  portion  thereof
 (herein,  a  Permitted  Transfer), without  Landlords  consent  and  without
 extending  any  sublease  or  termination  option to  Landlord,  to any corporation
 which  controls,  is

-11-

---

controlled  by or is under common
 control with  Tenant,  or to any  corporation resulting from a merger or consolidation
 with Tenant,  or to any person or entity which acquires all the assets of Tenants
 business as a going  concern,  provided that:  (a) at least twenty (20) days prior to
such  assignment or sublease,  Tenant delivers to Landlord the financial  statements and
other financial and background  information of the assignee or sublessee  described in
Section 14.3  below;  (b) if an assignment,  the assignee assumes, in full, the
 obligations  of Tenant under this Lease (or if a sublease,  the sublessee of a portion
of the Premises or Term assumes,  in full,  the  obligations of Tenant with respect to
such  portion);  (c) the  financial net worth of the assignee or  sublessee  equals or
exceeds  that of Tenant as of the date of  execution  of this  Lease;  (d) Tenant remains
 fully  liable  under this Lease;  (e) the use of the  Premises  under  Section 6
 remains  unchanged;  and (f) such transaction is not entered into as a subterfuge to
avoid the restrictions and provisions of this Lease.

14.3     Landlords
 Options. If at any time or from  time to time  during  the Term  Tenant  desires  to
effect a Transfer,  Tenant  shall  deliver to  Landlord,  at least  thirty  (30) days
prior to the date  Tenant  desires the Transfer to be effective  (Transfer  Date),
 written notice (Transfer Notice) setting forth the Transfer Date, the terms and
 provisions  of the proposed  Transfer,  the identity of the  proposed  assignee,
 sublessee or other transferee  (sometimes  referred to hereinafter as a  Transferee),
 and any ownership or commercial  relationship between  Tenant and the proposed
 Transferee.  Tenant shall also deliver to Landlord  with the Transfer  Notice,  a
current financial  statement and financial  statements for the preceding two (2) years of
the Transferee which have been  certified or audited by a reputable  independent
 accounting  firm  acceptable  to  Landlord,  and such other information  concerning the
business  background and financial condition of the proposed Transferee as Landlord may
reasonably  request.  Except with respect to a Permitted Transfer,  Landlord shall have
the option,  exercisable by written notice  delivered to Tenant within thirty (30) days
after Landlord's  receipt of the Transfer Notice,  such financial statements and other
information requested by Landlord, either to:

|(a) | approve
or disapprove such Transfer, which approval shall not be unreasonably withheld; or
|--- | ------------------------------------------------------------------------------------------

|(b) | sublet
from Tenant that portion of the Premises  which Tenant has  requested to sublease at the
rental and          on the other terms set forth in this Lease  prorate  for the portion
of the  Premises to be sublet and for          the term set forth in Tenants  Notice,
 or, in the case of an assignment or  encumbrance,  terminate this          Lease with
 respect to the  entire  Premises  and  recapture  the  Premises,  which  termination
 shall be          effective thirty (30) days after Tenants receipt of Landlords notice.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If Landlord  exercises its option to
sublease any such space from Tenant following  Tenant's request for Landlords approval
of the proposed  sublease of such space,  (i) Landlord  shall be responsible  for the
 construction of any partitions  which Landlord  reasonably  deems  necessary to separate
such space from the remainder of the Premises, and  (ii) Landlord  and any  sub-subtenant
 or assignee of Landlord with respect to such subleased space shall have the right to use
in common with Tenant all  lavatories,  corridors  and lobbies  which are within the
 Premises and which are reasonably required for the use of such space.

14.4     Additional
 Conditions;  Excess Rent. If for a Transfer other than a Permitted  Transfer Landlord
does not exercise  its  sublease  or  termination  option  and  instead  approves  of
 the  proposed  Transfer  pursuant  to Section 14.3(a)  above,  Tenant may enter into the
proposed Transfer with such proposed  Transferee  subject to the following further
conditions:

|(a) | the
 Transfer  shall be on the same terms set forth in the Transfer  Notice  delivered to
Landlord (if the          terms have  changed,  Tenant must submit a revised  Transfer
 Notice to Landlord and  Landlord  shall have          another  twenty  (20) days after
 receipt  thereof to make the  election  in  Sections 14.3(a)  or 14.3(b)          above);
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | no
Transfer  shall be valid and no  Transferee  shall take  possession  of the Premises
 until an executed          counterpart of the assignment,  sublease or other instrument
 affecting the Transfer has been delivered to          Landlord  pursuant to which the
Transferee shall expressly assume all of Tenants  obligations  under this          Lease
(or with  respect to a sublease of a portion of the  Premises  or for a portion of the
Term,  all of          Tenants obligations applicable to such portion);
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | no
 Transferee  shall have a further  right to assign,  encumber  or  sublet,  except on the
terms  herein          contained; and
|--- | ----------------------------------------------------------------------------------------------------------------------------------

|(d) | any
rent or other  economic  consideration  received by Tenant as a result of such Transfer
which exceeds,          in the  aggregate,  (i) the  total  rent  which  Tenant is
 obligated  to pay  Landlord  under  this Lease          (prorated to reflect
 obligations  allocable to any portion of the Premises  subleased,  but excluding any
         amortized tenant improvement costs, if any), plus (ii) any reasonable  brokerage
 commissions,  attorneys          fees and  moving  costs  actually  paid by  Tenant in
 connection  with  such  Transfer,  shall be paid to          Landlord  within ten (10)
days after  receipt  thereof as  additional  rental  under this  Lease,  without
         affecting or reducing any other obligations of Tenant hereunder.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

14.5     Reasonable
 Disapproval.  Landlord  and Tenant  hereby  acknowledge  that  Landlord's  disapproval
 of any proposed  Transfer  (other  than a  Permitted  Transfer)  pursuant to  Section 14.3(a)
 shall be deemed  reasonably withheld  if  based  upon  any  reasonable  factor,
 including,  without  limitation,  any or all of the  following factors:  (a) the
 proposed  Transfer  would result in more than two subleases of portions of the Premises
being in effect at any one time  during the Term;  (b) the net  effective  rent  payable
by the  Transferee  (adjusted  on a rentable  square foot basis) is less than the net
 effective  rent then being  quoted by Landlord for new leases in the  Building  for
 comparable  size space for a  comparable  period of time;  (c) the  proposed  Transferee
 is an existing  tenant of the Project or is negotiating  with Landlord (or has
 negotiated  with Landlord in the last six (6) months) for space in the Project;  (d) the
 proposed  Transferee is a governmental  entity;  (e) the portion of the Premises to be
sublet or assigned is irregular in shape with  inadequate  means of ingress and egress;
 (f) the use of the  Premises  by the  Transferee  (i) is not  permitted  by the use
 provisions  in  Section 6  hereof,  or (ii) violates  any exclusive  use granted by
Landlord to another  tenant in the Building;  (g) the  Transfer  would likely  result  in
 significant  increase  in the use of the  parking  areas or  Common  Areas by the
 Transferees employees or visitors,

-12-

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and/or  significantly  increase  the
demand upon  utilities  and services to be provided by Landlord to the Premises;  (h) the
 Transferee  does not have the financial  capability to fulfill the  obligations imposed
by the  Transfer;  or (i) the  Transferee  is not in  Landlords  reasonable  opinion of
 reputable or good character or  consistent  with  Landlords  desired  tenant mix.
 Notwithstanding  any  contrary  provision of this Lease, if Tenant or any proposed
 Transferee claims that Landlord has unreasonably  withheld or delayed its consent to a
proposed  Transfer or  otherwise  has  breached  its  obligations  under this  Section
14,  Tenants  and such Transferees only remedy shall be to seek a declaratory  judgment
and/or injunctive  relief,  and Tenant, on behalf of itself  and,  to the extent
 permitted  by law,  such  proposed  Transferee  waives all other  remedies  against
Landlord, including, without limitation, the right to seek monetary damages or to
terminate this Lease.

14.6     No
Release.  No  Transfer  shall  release  Tenant of  Tenants  obligations  under this
Lease or alter the primary  liability  of Tenant  to pay the rent and to  perform  all
other  obligations  to be  performed  by Tenant hereunder.  Landlord may require that any
 Transferee  remit  directly to Landlord on a monthly  basis,  all monies due Tenant by
said  Transferee,  and each sublease  shall  provide that if Landlord  gives said
 sublessee  written notice that Tenant is in default under this Lease,  said sublessee
will  thereafter make all payments due under the sublease  directly to or as directed by
Landlord,  which  payments will be credited  against any payments due under this Lease.
 Tenant hereby  irrevocably  and  unconditionally  assigns to Landlord all rents and
other sums payable under any sublease of the Premises;  provided,  however,  that
 Landlord  hereby grants Tenant a license to collect all such rents and other  sums so
long as Tenant is not in  default  under this  Lease.  Tenant  shall,  within ten (10)
days after the execution and delivery of any assignment or sublease,  deliver a duplicate
 original copy there of to  Landlord.  However,  the  acceptance  of rent by Landlord
 from any other person shall not be deemed to be a waiver by Landlord of any  provision
 hereof.  Consent by Landlord to one Transfer  shall not be deemed  consent to any
 subsequent  Transfer.  In the event of default by any  Transferee  of Tenant or any
successor of Tenant in the performance  of any of the terms hereof,  Landlord may proceed
 directly  against  Tenant  without the necessity of exhausting  remedies  against such
Transferee or successor.  Landlord may consent to subsequent  assignments of the Lease or
 sublettings  or amendments or  modifications  to the Lease with  assignees of Tenant,
 without  notifying Tenant,  or any successor of Tenant,  and without obtaining its or
their consent thereto and any such actions shall not relieve Tenant of liability under
this Lease.

14.7     Administrative
 and  Attorneys  Fees. If Tenant effects a Transfer or requests the consent of Landlord
to any Transfer,  then Tenant shall,  upon demand,  pay Landlord a non-refundable
 administrative  fee of One Thousand Five  Hundred  Dollars  ($1,500.00),  plus any
 reasonable  attorneys  and  paralegal  fees and costs  incurred by Landlord in
 connection  with such Transfer or request for consent  (whether  attributable  to
Landlord's  in-house attorneys  or  paralegals  or  otherwise).   Acceptance  of  the
 One  Thousand  Five  Hundred  Dollar  ($1,500.00) administrative  fee and/or
 reimbursement  of Landlords  attorneys  and paralegal fees shall in no event obligate
Landlord to consent to any proposed Transfer.

14.8     Material
Inducement.  Tenant understands,  acknowledges and agrees that (a) Landlord's  option to
sublease from Tenant any space which Tenant  proposes to sublease or terminate  this
Lease upon any proposed  assignment  or encumbrance  of this Lease by Tenant as  provided
 in  Section 14.3(b)  above  rather  than  approve  the  proposed sublease,  assignment
 or  encumbrance,  and  (b) Landlords  right to receive any excess  consideration  paid
by a Transferee  in  connection  with an  approved  Transfer  as  provided  in  Section 14.4(d)
 above,  are a  material inducement  for  Landlord's  agreement  to lease the  Premises
to Tenant upon the terms and  conditions  herein set forth.

15.     Entry by
Landlord.  Landlord and its  employees  and agents shall at all  reasonable  times have
the right to enter the  Premises to inspect the same,  to supply  janitorial  service
 and any other  service  required to be provided by Landlord to Tenant under this Lease,
 to exhibit the Premises to prospective  lenders or purchasers (or during  the last year
of the Term,  to  prospective  tenants),  to post  notices of  non-responsibility,
 and/or to alter,  improve or repair the Premises or any other  portion of the Building
or Project,  all without  being deemed guilty of or liable for any breach of  Landlord's
 covenant  of quiet  enjoyment  or any  eviction  of Tenant,  and without  abatement of
rent. In exercising  such entry rights,  Landlord shall  endeavor to minimize,  as
reasonably practicable,  the interference  with Tenants  business,  and shall provide
Tenant with reasonable  advance written notice of such entry  (except in  emergency
 situations  and for  scheduled  services).  For each of the  foregoing purposes,
 Landlord  shall at all times have and  retain a key with  which to unlock all of the
doors in,  upon and about the Premises,  excluding  Tenants  vaults and safes,  and
Landlord  shall have the means which  Landlord may deem  proper  to open  said  doors in
an  emergency  in order to  obtain  entry to the  Premises.  Any entry to the Premises
 obtained by Landlord by any of said means or otherwise shall not under any
 circumstances be construed or deemed to be a forcible or unlawful  entry into, or a
detainer of, the Premises,  or an eviction of Tenant from the Premises or any portion
 thereof,  or grounds for any  abatement or  reduction of rent and Landlord  shall not
have any  liability  to Tenant for any  damages or losses on account of any such entry by
 Landlord  except,  subject to the provisions of Section 22.1, to the extent of
Landlords gross negligence or willful misconduct.

16.     Utilities
and Services.

16.1     Standard
 Utilities  and  Services.  As long as Tenant has not  committed an uncured  default
under any of the  provisions  of this Lease,  and subject to the terms and  conditions
 of this Lease,  and the  obligations  of Tenant as set forth  hereinbelow,  Landlord
 shall  furnish or cause to be furnished to the Premises the  following utilities and
services,  the costs of which shall be included in Operating  Expenses,  unless
 otherwise  specified below  (Landlord  reserves the right to adopt  non-discriminatory
 modifications  and  additions  to the  following provisions from time to time):

|(a) | Landlord
shall make the elevator of the Building  available for Tenant's  non-exclusive  use,
 twenty-four          (24) hours per day.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------

|(b) | Landlord
 shall  furnish  during the Business  Hours for the Building  specified  in  Section 1.17
 of the          Summary  (which  Business  Hours shall be subject to change from time to
time by Landlord,  in  Landlords          reasonable  discretion),  heating,
 ventilation and air conditioning (HVAC) for the Premises as required          in
 Landlord's  judgment  for  the
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | comfortable
 and  normal  occupancy  of  the  Premises.  The  cost  of          maintenance  and
service  calls to adjust and  regulate  the HVAC system shall be charged to Tenant if the
         need for  maintenance  work  results  from either  Tenants  adjustment  of room
 thermostats  or Tenants          failure to comply with its obligations  under this
Section 16,  including  keeping window coverings closed          as needed.  Such work
shall be charged at hourly rates equal to then-current  journeyman's  wages for HVAC
         mechanics.  If Tenant  desires  HVAC at any time other than during the  Business
 Hours for the  Building,          Landlord shall provide such  after-hours  usage
after advance  reasonable  request by Tenant, and Tenant          shall pay to  Landlord,
 as  additional  rent (and not as part of the  Operating  Expenses)  the cost,  as
         fairly  determined by Landlord,  of such after-hours usage (as well as the cost
of any HVAC used by Tenant          in excess of what  Landlord  considers  reasonable
 or normal),  including  any minimum  hour  charges for          after-hours  requests
and any special  start-up  costs for  after-hours  services which requires a special
         start-up  (such as late  evenings,  weekends and  holidays)  together with an
 administrative  fee of five          percent (5%) of the cost of such  after-hours
 usage,  which  administrative  fee shall also be payable by          Tenant  to
 Landlord  for the cost of any other  services  provided  by  Landlord  to Tenant  that
are not          otherwise required to be provided by Landlord to Tenant hereunder.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Landlord
shall furnish  janitorial  services to the Premises five (5) days per week pursuant to
janitorial          and cleaning  specifications  as may be adopted by Landlord  from
time to time.  No  person(s)  other than          those  persons  approved  by  Landlord
 shall  be  permitted  to enter  the  Premises  for such  purposes.          Janitorial
 service shall include  ordinary  dusting and cleaning by the janitor  assigned to do
such work          and shall not include  cleaning  of carpets or rugs,  except  normal
 vacuuming,  or moving of  furniture,          interior  window  cleaning,  coffee or
eating area cleaning and other special  services.  Such  additional          services may
be rendered by Landlord  pursuant to written  agreement  with Tenant as to the extent of
such          services  and the payment of the cost  thereof.  Janitorial  service  will
not be furnished on nights when          rooms  are  occupied  after  7:30 p.m.  or to
rooms  which are  locked  unless a key is  furnished  to the          Landlord for use by
the janitorial  contractor.  Window  cleaning shall be done only by Landlord,  at such
         time and  frequency  as  determined  by  Landlord  at  Landlords  sole
 discretion.  Tenant  shall pay to          Landlord  the cost of removal of any of
Tenants  refuse and  rubbish to the extent that the same  exceeds          the refuse
and rubbish usually attendant upon the use of the Premises as offices.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | Landlord
 may, in  Landlord's  sole  discretion,  provide  security  service or protection in the
Building          and/or the Project,  in any manner deemed  reasonable by Landlord at
Landlords sole discretion,  from the          Commencement Date throughout the Term.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

16.2     Tenants
 Obligations. Tenant shall control and be separately  metered for the  electricity,
 gas, water, telephone  for the  Premises or other  services  which are  metered,
 chargeable  or provided to the  Premises,  at Tenants sole cost and expense.  Tenant
shall make all such payments  directly to the utility  provider as and when bills are
 rendered.  Should  Tenant  fail to pay such  amounts,  Landlord  shall have the right to
pay the same on Tenants  behalf  and  Tenant  shall  reimburse  Landlord  for all costs
 and  expenses  incurred  by  Landlord  in conjunction  with such payment  within ten
(10) days after demand  therefor.  All such costs and expenses  incurred by Landlord on
Tenant's  behalf shall be deemed  additional  rent payable by Tenant and  collectible by
Landlord as such. At no time shall use of  electricity  in the Premises  exceed the
capacity of existing  feeders and risers to or wiring in the  Premises.  Any risers or
wiring to meet  Tenants  excess  electrical  requirements  shall,  upon Tenants written
request, be installed by Landlord,  at Tenant's sole cost, if, in Landlords  reasonable
judgment, the same are  necessary  and shall not  (i) cause  permanent  damage or injury
to the Project,  the Building or the Premises,  (ii) cause  or create a  dangerous  or
 hazardous  condition,  (iii) entail  excessive  or  unreasonable alterations,  repairs
or expenses,  or  (iv) interfere  with or disturb other tenants or occupants of the
Building. Tenant shall cooperate fully at all times with Landlord,  and abide by all
reasonable  regulations and requirements which Landlord may prescribe for the proper
 functioning  and  protection of the  Buildings  services and systems. Tenant  shall not
use any  apparatus  or device in, upon or about the  Premises  which may in any way
 increase the amount of services or utilities  usually  furnished or supplied to the
Premises or other  premises in the Building. In addition,  Tenant shall not connect any
conduit,  pipe, apparatus or other device to the Buildings water, waste or other  supply
 lines or  systems  for any  purpose.  Neither  Tenant  nor its  employees,  agents,
 contractors, licensees or invitees  shall at any time enter,  adjust,  tamper with,
 touch or otherwise in any manner affect the mechanical installations or facilities of
the Building.

16.3     Failure
to Provide  Services.  Landlords  failure to furnish or delay in  furnishing  any of the
services described  in  Section 16.1  above when such failure is caused by all or any of
the  following  shall not result in any liability of Landlord:  (a) casualty,  accident,
breakage or repairs; (b) acts of terrorism,  strikes, lockouts or other labor
 disturbances or labor disputes of any such character;  (c) governmental  regulation,
 moratorium or other governmental  action;  (d) inability,  despite the exercise of
reasonable  diligence,  to obtain electricity, water or fuel,  including due to
shortages,  blackouts or any other cause; or (e) any other cause beyond Landlord's
reasonable  control. In addition,  in the event of the failure of any said utilities or
services,  Tenant shall not be entitled to any abatement or reduction of rent (except as
expressly  provided in Sections 18.3  and 19.2 if such failure is a result of a damage or
taking  described  therein),  no eviction  of Tenant  shall  result,  and Tenant shall
not be relieved  from the  performance  of any  covenant or agreement  in this Lease.
 Furthermore,  Landlord shall  not be  liable  under  any  circumstances  for a loss of,
 or  injury  to,  property  or for  injury  to, or interference with, Tenant's business,
 including,  without limitation, loss of profits, however occurring,  through or in
connection  with or  incidental to a failure to furnish any of the services as set forth
in this  Section 16. In the event of any  stoppage or  interruption  of services or
 utilities,  Landlord  shall  diligently  attempt to resume such services or utilities as
promptly as  practicable.  Tenant  hereby waives the  provisions of California Civil Code
 Section 1932(1) or any other applicable  existing or future law,  ordinance or
governmental  regulation permitting the termination of this Lease due to an interruption,
failure or inability to provide any services.

17.     Indemnification
and Exculpation.

17.1     Tenants
 Assumption  of Risk  and  Waiver.  Except  to the  extent  such  matter  is not  covered
 by the insurance  required  to be  maintained  by Tenant  under this Lease and such
 matter is  attributable  to the gross negligence or willful

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misconduct of Landlord,  its agents,
 employees or contractors  Landlord shall not be liable to Tenant,  Tenants  employees,
 agents or invitees  for:  (i) any  damage to  property  of Tenant,  or of others,
located in, on or about the  Premises,  nor for  (ii) the  loss of or damage to any
property of Tenant or of others by theft or otherwise,  (iii) any injury or damage to
persons or property resulting from fire,  explosion,  falling plaster,  steam, gas,
 electricity,  water, rain or leaks from any part of the Premises or from the pipes,
plumbing works or from the roof,  street or  subsurface  or from any other  places or by
 dampness  or by any other cause of whatsoever  nature,  or (iv) any  such  damage
 caused by other  tenants or persons in the  Project,  occupants  of adjacent  property
of the Project,  or the public,  or caused by operations in construction of any private,
 public or  quasi-public  work.  Landlord shall in no event be liable to Tenant for any
 consequential  damages or for loss of revenue or income and Tenant  waives any and all
claims for any such  damages.  Notwithstanding  anything to the contrary  contained  in
this  Section 17.1,  all property of Tenant,  its agents,  employees  and invitees  kept
or stored on the Premises,  whether  leased or owned by any such parties,  shall be so
kept or stored at the sole risk of Tenant and Tenant shall hold  Landlord  harmless  from
any claims  arising out of damage to the same,  including subrogation claims by Tenant's
insurance carriers.

17.2     Tenants
 Indemnification of Landlord.  Tenant shall be liable for, and shall indemnify,  defend,
 protect and hold Landlord and the Landlord  Indemnified  Parties  harmless from and
against,  any and all claims,  damages, judgments,  suits, causes of action,  losses,
 liabilities and expenses,  including attorneys fees and court costs (collectively,
 Indemnified Claims),  arising or resulting from (a) any occurrence at the Premises,
unless caused by the gross negligence or willful  misconduct of Landlord or its agents,
 employees or contractors and not covered by the insurance  required to be  maintained
 by Tenant under this Lease,  (b) any act or omission of Tenant or any of Tenants
agents, employees,  contractors,  subtenants,  assignees, licensees or invitees
(collectively,  Tenant Parties);  (c) the use of the Premises  and Common Areas and
conduct of Tenant's  business by Tenant or any Tenant Parties,  or any other activity,
 work or thing done,  permitted or suffered by Tenant or any Tenant Parties, in or about
the Premises,  the Building or elsewhere on the Project;  and/or (d) any default by
Tenant of any obligations on Tenant's  part to be performed  under the terms of this
Lease or the terms of any contract or agreement to which Tenant is a party or by which it
is bound,  affecting  this Lease or the Premises.  The  foregoing  indemnification shall
 include,  but not be limited to, any injury to, or death of, any  person,  or any loss
of, or damage to, any property on the  Premises,  or on adjoining  sidewalks,  streets or
ways, or connected  with the use,  condition or occupancy  thereof,  whether or not
Landlord or its mortgagee has or should have  knowledge or notice of the defect or
conditions  causing or contributing to such injury,  death,  loss or damage. In case any
action or proceeding is brought against  Landlord or any Landlord  Indemnified  Parties
by reason of any such Indemnified  Claims,  Tenant, upon notice from Landlord,  shall
defend the same at Tenant's  expense by counsel  approved in writing by Landlord, which
approval shall not be unreasonably withheld.

17.3     Reciprocal
 Indemnity.  Notwithstanding  any provisions of Lease  Sections 17.1  and 17.2 to the
contrary, Tenant shall not be required to indemnify and hold Landlord  harmless  from any
 Indemnified  Claims to any person, property  or  entity  resulting  from the gross
 negligence  or  willful  misconduct  of  Landlord  or its  agents, contractors,
 servants,  employees or licensees in connection  with Landlord's  activities in the
Building  (except for damage to the Tenant  Improvements and Tenants  personal
 property,  fixtures,  furniture and equipment in the Premises,  to the extent Tenant is
required to obtain the requisite  insurance  coverage  pursuant to the Lease) or the
Site.  Landlord shall  indemnify and hold Tenant harmless from any such  Indemnified
 Claims (but not including any loss of  business,  loss of profits  or other
 consequential  damages);  provided,  however,  to the extent any damage or repair
 obligation  is covered by insurance  obtained by Landlord as part of Operating
 Expenses,  but is not covered by insurance  obtained by Tenant,  then Tenant shall be
relieved of its indemnity  obligation up to the amount of the insurance  proceeds which
Landlord is entitled to receive.  Tenant's  agreement to indemnify and hold Landlord
 harmless  pursuant to  Section 17.2  above and the  exclusion  from  Tenant's  indemnity
 and  Landlord's agreement  to  indemnify  and hold Tenant  harmless  pursuant to this
 provision  are not intended to and shall not relieve any  insurance  carrier of its
 obligations  under  policies  required to be carried by Landlord or Tenant,
respectively,  pursuant to the Lease to the extent that such policies cover the results
of such acts,  omissions or willful misconduct.

17.4     Survival;
  No  Release  of  Insurers.   Tenants  and  Landlords   indemnification   obligations
  under Sections 17.2  and 17.3 shall survive the  expiration or earlier  termination  of
this Lease.  Tenants  covenants, agreements  and  indemnification  in  Sections 17.1
 and 17.2 above are not  intended  to and shall not relieve any insurance  carrier of its
 obligations  under policies  required to be carried by Tenant pursuant to the provisions
of this Lease.

18.     Damage
or Destruction.

18.1     Landlords
 Rights and  Obligations. In the event the  Premises or any part of the Building is
damaged by fire or other casualty to an extent not exceeding  twenty-five  percent (25%)
of the full replacement cost thereof, and  Landlords  contractor  estimates in a writing
 delivered to the parties that the damage  thereto is such that the  Building  and/or
 Premises  may  be  repaired,  reconstructed  or  restored  to  substantially  its
 condition immediately  prior to such  damage  within  one  hundred  twenty  (120)  days
from the date of such  casualty,  and Landlord  will  receive  insurance  proceeds
 sufficient  to cover the costs of such  repairs,  reconstruction  and restoration
 (including  proceeds  from Tenant  and/or  Tenants  insurance  which Tenant is required
to deliver to Landlord  pursuant to  Section 18.2  below),  then Landlord shall commence
and proceed  diligently with the work of repair,  reconstruction  and restoration and
this Lease shall continue in full force and effect.  If, however,  the Premises  or any
other part of the  Building is damaged to an extent  exceeding  twenty-five  percent
 (25%) of the full replacement cost thereof,  or Landlord's  contractor  estimates that
such work of repair,  reconstruction  and restoration  will  require  longer than one
hundred  twenty (120) days to  complete,  or Landlord  will not receive insurance
 proceeds  (and/or  proceeds from Tenant,  as applicable)  sufficient to cover the costs
of such repairs, reconstruction and restoration, then Landlord may elect to either:

|(a) | repair,
 reconstruct  and  restore the  portion of the  Building  and  Premises  damaged by such
 casualty          (including the, to the extent of insurance  proceeds  received from
Tenant,  the Tenant  Improvements  and          the Tenant Changes), in which case this
Lease shall continue in full force and effect; or
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|(b) | terminate
 this  Lease  effective  as of the date  which is thirty  (30) days  after  Tenants
 receipt of          Landlord's election to so terminate.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------

Under any of the  conditions of this
 Section 18.1,  Landlord  shall give written notice to Tenant of its intention to repair
or terminate  within the later of sixty (60) days after the occurrence of such casualty,
 or fifteen (15) days after Landlord's receipt of the estimate from Landlords contractor.

18.2     Tenants
 Costs and Insurance  Proceeds.  In the event of any damage or  destruction of all or any
part of the Premises,  Tenant shall  immediately:  (a) notify  Landlord thereof;  and (b) deliver
to Landlord all insurance proceeds received by Tenant with respect to the Tenant
 Improvements and Tenant Changes in the Premises  (excluding proceeds  for  Tenants
 furniture  and other  personal  property),  whether  or not this  Lease is  terminated
 as permitted  in this  Section 18,  and Tenant  hereby  assigns to  Landlord  all
 rights to  receive  such  insurance proceeds.  If, for any reason  (including  Tenants
 failure to obtain  insurance for the full  replacement cost of the Tenant  Improvements
 and any Tenant  Changes which Tenant is required to insure  pursuant to  Sections 12.1(c)
and/or 20.1(a)  hereof),  Tenant fails to receive  insurance  proceeds  covering the full
 replacement cost of such Tenant  Improvements  and  Tenant  Changes  which are  damaged,
 Tenant  shall be deemed to have  self-insured  the replacement  cost of such Tenant
 Improvements  and Tenant  Changes,  and upon any damage or  destruction  thereto, Tenant
shall  immediately  pay to Landlord the full  replacement  cost of such items,  less any
insurance  proceeds actually received by Landlord from Landlords or Tenants insurance
with respect to such items.

18.3     Abatement
 of Rent.  In the  event  that as a result of any such  damage,  repair,  reconstruction
 and/or restoration  of the Premises or the  Building,  Tenant is prevented  from using,
 and does not use, the Premises or any  portion  thereof,  then the  Monthly  Basic Rent
shall be abated or  reduced,  as the case may be,  during the period that Tenant
 continues to be so prevented  from using and does not use the Premises or portion
 thereof,  in the  proportion  that the rentable  square feet of the portion of the
Premises that Tenant is prevented from using, and does not use, bears to the total
 rentable  square feet of the Premises.  Notwithstanding  the foregoing to the contrary,
 if the damage is due to the  negligence  or willful  misconduct of Tenant or any Tenant
 Parties,  there shall be no abatement of Monthly Basic Rent.  Except for  abatement of
Monthly Basic Rent as provided  hereinabove, Tenant shall not be entitled to any
compensation or damages for loss of, or interference  with,  Tenants  business or use or
access of all or any part of the Premises  resulting  from any such  damage,  repair,
 reconstruction  or restoration.

18.4     Inability
 to Complete.  Notwithstanding  anything to the contrary  contained in this  Section 18,
 in the event Landlord is obligated or elects to repair,  reconstruct  and/or  restore
the damaged  portion of the Building or Premises  pursuant to Section 18.1  above,  but
is delayed from completing  such repair,  reconstruction  and/or restoration  beyond  the
date  which is six (6)  months  after the date  estimated  by  Landlords  contractor
 for completion  thereof  pursuant to  Section 18.1,  by reason of any causes beyond the
reasonable  control of Landlord (including,  without limitation, delays due to Force
Majeure events as defined in Section 32.15,  and delays caused by Tenant or any Tenant
 Parties),  then  Landlord may elect to  terminate  this Lease upon thirty (30) days'
prior written notice to Tenant.

18.5     Damage
 Near End of  Term.  In  addition  to its  termination  rights  in  Sections 18.1  and
18.4  above, Landlord shall have the right to terminate  this Lease if any damage to the
Building or Premises  occurs during the last twelve (12) months of the Term of this Lease
and  Landlords  contractor  estimates in a writing  delivered to the parties that the
repair,  reconstruction  or restoration of such damage cannot be completed  within the
earlier of (a) the scheduled expiration date of the Lease Term, or (b) sixty (60) days
after the date of such casualty.

18.6     Waiver
of  Termination  Right.  This Lease sets forth the terms and  conditions  upon which this
Lease may terminate  in the event of any damage or  destruction.  Accordingly,  the
parties  hereby waive the  provisions  of California Civil Code  Section 1932,  Subsection 2,
 and  Section 1933,  Subsection 4  (and any successor  statutes thereof permitting the
parties to terminate this Lease as a result of any damage or destruction).

19.     Eminent
Domain.

19.1     Substantial
 Taking.  Subject to the provisions of  Section 19.4  below in case the whole of the
Premises, or such part  thereof  as shall  substantially  interfere  with  Tenant's  use
and  occupancy  of the  Premises  as reasonably  determined by Landlord,  shall be taken
for any public or  quasi-public  purpose by any lawful power or authority  by exercise of
the right of  appropriation,  condemnation  or eminent  domain,  or sold to prevent  such
taking,  either party shall have the right to terminate this Lease  effective as of the
date possession is required to be surrendered to said authority.

19.2     Partial
 Taking;  Abatement of Rent. In the event of a taking of a portion of the Premises  which
does not substantially  interfere  with the  conduct  of  Tenants  business,  then,
 except as  otherwise  provided  in the immediately  following  sentence,  neither  party
shall have the right to terminate  this Lease and Landlord  shall thereafter  proceed to
make a functional  unit of the  remaining  portion of the  Premises  (but only to the
extent Landlord receives proceeds  therefor from the condemning  authority),  and rent
shall be abated with respect to the part  of the  Premises  which  Tenant  shall  be so
 deprived  on  account  of  such  taking.  Notwithstanding  the immediately  preceding
 sentence to the contrary,  if any part of the Building or the Site shall be taken
 (whether or not such taking substantially  interferes with Tenants use of the
Premises),  Landlord may terminate this Lease upon thirty (30) days prior written notice
to Tenant.

19.3     Condemnation
 Award.  Subject to the provisions of  Section 19.4  below,  in connection with any
taking of the Premises or Building,  Landlord  shall be entitled to receive the entire
 amount of any award which may be made or given in such taking or condemnation,  without
 deduction or apportionment for any estate or interest of Tenant, it being  expressly
 understood  and agreed by Tenant that no portion of any such award shall be allowed or
paid to Tenant for any  so-called  bonus or excess  value of this Lease,  and such bonus
or excess  value shall be the sole property  of  Landlord.  Tenant  shall not assert  any
claim  against  Landlord  or the  taking  authority  for any compensation  because of
such  taking  (including  any

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---

claim for bonus or excess  value of
this  Lease);  provided, however,  if any  portion  of the  Premises  is  taken,  Tenant
 shall be  granted  the right to  recover  from the condemning  authority  (but not from
 Landlord) any  compensation  as may be separately  awarded or  recoverable by Tenant for
the taking of Tenants furniture,  fixtures,  equipment and other personal property
within the Premises, for Tenants  relocation  expenses,  and for any loss of goodwill or
other damage to Tenants business by reason of such taking.

19.4     Temporary
 Taking. In the  event of a taking of the  Premises  or any part  thereof  for
 temporary  use, (a) this Lease shall be and remain  unaffected  thereby and rent shall
not abate,  and (b) Tenant shall be entitled to receive  for itself such  portion or
 portions of any award made for such use with  respect to the period of the taking which
is within the Term,  provided  that if such taking shall remain in force at the
 expiration or earlier termination of this Lease,  Tenant shall perform its  obligations
 under Section 9 with respect to surrender of the Premises  and shall pay to Landlord
 the portion of any award  which is  attributable  to any period of time beyond the Term
expiration  date. For purpose of this  Section 19.4,  a temporary  taking shall be
defined as a taking for a period of two hundred seventy (270) days or less.

19.5     Waiver
of  Termination  Right.  This Lease sets forth the terms and  conditions  upon which this
Lease may terminate  in the event of a taking.  Accordingly,  the parties  waive the
 provisions  of the  California  Code of Civil Procedure  Section 1265.130  and any
successor or similar  statutes  permitting the parties to terminate this Lease as a
result of a taking.

20.     Tenants
Insurance.

20.1     Types
of  Insurance.  On or before the earlier of the  Commencement  Date or the date Tenant
 occupies all or any portion of the Premises or  commences  or causes to be commenced
 any work of any type in or on the Premises pursuant to this Lease,  and  continuing
 during the entire  Term,  Tenant  shall obtain and keep in full force and effect, the
following insurance:

|(a) | Special
 Form  (fka  All  Risk)  insurance,  including  fire  and  extended  coverage,  sprinkler
 leakage          (including  earthquake  sprinkler  leakage),  vandalism,  malicious
 mischief  and  earthquake  and  flood          coverage  upon  property  of every
 description  and kind owned by Tenant and  located in the  Premises or
         Building,  or for  which  Tenant  is  legally  liable or  installed  by or on
behalf of Tenant  including,          without  limitation,  furniture,  equipment and any
other personal  property,  and any Tenant Changes (and          including the Tenant
 Improvements  previously  existing or installed in the  Premises),  in an amount not
         less  then the full  replacement  cost  thereof.  In the event  that  there
 shall be a dispute  as to the          amount which  comprises  full  replacement  cost,
 the decision of Landlord or the  mortgagees of Landlord          shall be conclusive.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | Commercial
 general  liability  insurance  coverage,  on an occurrence basis,  including  personal
injury,          bodily  injury  (including  wrongful  death),  broad form  property
 damage,  operations  hazard,  owner's          protective  coverage,  contractual
 liability (including Tenant's  indemnification  obligations under this          Lease,
 including  Section 17  hereof),  liquor  liability  (if Tenant  serves  alcohol on the
 Premises),          products  and  completed  operations  liability,  and
 owned/non-owned  auto  liability,  with an  initial          combined  single limit of
liability of not less than Two Million  Dollars  ($2,000,000.00).  The limits of
         liability of such commercial  general  liability  insurance shall be increased
every five (5) years during          the Term of this Lease to an amount reasonably
required by Landlord.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Worker's
 compensation in statutory amounts and employer's liability  insurance,  with limits no
less than          One Million Dollars  ($1,000,000.00) per occurrence,  covering all
persons employed in connection with any          work done on or about the Premises for
which claims for death or bodily  injury could be asserted  against          Landlord,
Tenant or the Premises.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | Loss
of income,  extra  expense and business  interruption  insurance  in such  amounts as
will  reimburse          Tenant for direct or indirect loss of earnings  attributable  to
all perils  commonly  insured  against by          prudent  tenants or  attributable  to
prevention of access to the Premises,  Tenants  parking areas or to          the
Building as a result of such perils.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(e) | Any
other form or forms of insurance as Tenant or Landlord or the  mortgagees  of Landlord
may  reasonably          require from time to time, in form,  amounts and for insurance
 risks against which a prudent tenant would          protect  itself,  but only to the
extent such risks and amounts are available in the  insurance  market at
         commercially reasonable costs.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

20.2     Requirements.
 Each policy required to be obtained by Tenant  hereunder  shall:  (a) be issued by
insurers which are approved by Landlord  and/or  Landlord's  mortgagees  and are
 authorized  to do business in the state in which the  Building  is  located  and are
rated not less  than  financial  class X, and not less than  policyholder rating A in the
most recent  version of Best's Key Rating Guide  (provided  that, in any event,  the same
insurance company shall provide the coverages  described in  Sections 20.1(a)  and
20.1(d) above);  (b) be in form reasonably satisfactory  from time to time to Landlord;
 (c) name  Tenant as named insured  thereunder and shall name Landlord and, at Landlords
request,  Landlord's  mortgagees,  ground lessors (if any) and managers of which Tenant
has been informed in writing,  as additional  insureds  thereunder,  all as their
respective  interests may appear;  (d) not have a deductible  amount exceeding Five
Thousand Dollars  ($5,000.00),  which amount shall be deemed  self-insured with full
waiver of  subrogation);  (e) specifically  provide  that the  insurance  afforded by
such policy for the benefit of Landlord and Landlords  mortgagees and ground  lessors
shall be primary,  and any insurance  carried by Landlord  or  Landlords  mortgagees
 and ground  lessors  shall be excess  and  non-contributing;  (f) contain  an
endorsement  that the insurer  waives its right to  subrogation  as described in Section 22
 below;  (g) contain an undertaking  by the insurer to notify  Landlord (and the
mortgagees and ground lessors of Landlord who are named as additional  insureds)  in
 writing  not less than  thirty  (30) days prior to any  material  change,  reduction  in
coverage,  cancellation  or other  termination  thereof;  (h) contain a cross liability
or severability of interest endorsement;  and (i) be in

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amounts sufficient at all times to
satisfy any coinsurance  requirements  thereof. Each such  policy  shall also  provide
 that any loss  otherwise  payable  thereunder  shall be payable  notwithstanding (i) any
act or omission of Landlord or Tenant which might, absent such provision,  result in a
forfeiture of all or a part of such  insurance  payment,  (ii) the  occupation or use of
the Premises for purposes more  hazardous  than permitted by the  provisions  of such
policy,  (iii) any  foreclosure  or other action or  proceeding  taken by any mortgagee
 pursuant to any  provision  of the mortgage  upon the  happening  of a default
 thereunder,  or (iv) any change in title or  ownership of the  Premises.  Tenant  agrees
to deliver to Landlord,  in no event later than the earlier of (i) the  Commencement
 Date or (ii) the date Tenant takes possession of all or any part of the Premises,
certified  copies of each such  insurance  policy  (or  certificates  from the  insurance
 company  evidencing  the existence of such  insurance and Tenants  compliance  with the
foregoing  provisions of this  Section 20).  Tenant shall cause  replacement  policies or
certificates to be delivered to Landlord not less than thirty (30) days prior to the
 expiration  of any such policy or policies.  If any such initial or  replacement
 policies or  certificates are not  furnished  within the time(s)  specified  herein,
 Tenant shall be deemed to be in material  default under this Lease  without the  benefit
of any  additional  notice or cure period  provided  in  Section 23.1  below,  and
Landlord  shall have the right,  but not the  obligation,  to procure such  policies and
 certificates  at Tenant's expense.

20.3     Effect
on  Insurance.  Tenant  shall  not do or  permit to be done  anything  which  will  (a) violate
 or invalidate  any insurance  policy  maintained by Landlord or Tenant  hereunder,  or
 (b) increase  the costs of any insurance  policy  maintained by Landlord  pursuant to
Section 21 or otherwise  with respect to the Building or the Project.  If Tenant's
 occupancy or conduct of its  business  in, on or about the Premises  results in any
increase in premiums for any  insurance  carried by Landlord  with respect to the
Building or the Project,  Tenant shall pay such increase as  additional  rent within ten
(10) days after being billed  therefor by Landlord.  If any insurance coverage  carried
by Landlord  pursuant to  Section 21  or  otherwise  with  respect to the Building or the
Project shall be cancelled or reduced (or  cancellation  or reduction  thereof shall be
threatened) by reason of the use or occupancy of the Premises by Tenant or by anyone
 permitted by Tenant to be upon the Premises,  and if Tenant fails to remedy such
condition  within five (5) days after notice thereof,  Tenant shall be deemed to be in
default under this Lease,  without the benefit of any  additional  notice or cure period
 specified in  Section 23.1  below,  and Landlord shall have all remedies provided in
this Lease, at law or in equity,  including,  without limitation,  the right (but not the
obligation) to enter upon the Premises and attempt to remedy such condition at Tenants
cost.

21.     Landlords
 Insurance.  During the Term,  Landlord shall insure the Building and the Premises
 (excluding, however,  Tenant's  furniture,  equipment and other personal  property and
the Tenant  Improvements  and any Tenant Changes)  against damage by fire and standard
 extended  coverage perils and with vandalism and malicious  mischief endorsements,
 rental loss  coverage,  at  Landlord's  option,  earthquake  damage  coverage,  and such
 additional coverage as Landlord deems  appropriate.  Landlord shall also carry
 commercial  general  liability  insurance,  in such reasonable  amounts and with such
 reasonable  deductibles as would be carried by a prudent owner of a similar building in
the State of  California.  At Landlord's  option,  all such  insurance may be carried
under any blanket or umbrella  policies  which  Landlord has in force for other
 buildings and projects.  In addition,  at Landlord's option,  Landlord may elect to
self-insure all or any part of such required insurance  coverage.  Landlord may, but
shall not be  obligated  to, carry any other form or forms of  insurance  as Landlord or
the  mortgagees  or ground lessors of Landlord may  reasonably  determine is advisable.
 The cost of insurance  obtained by Landlord  pursuant to this Section 21 (including
self-insured amounts and deductibles) shall be included in Operating Expenses.

22.     Waiver
of Claims; Waiver of Subrogation.

22.1     Mutual
Waiver of Parties.  Landlord and Tenant  hereby waive their rights  against each other
with respect to any claims or damages or losses which are caused by or result from  (a) occurrences
 insured  against  under any insurance  policy  carried by Landlord or Tenant (as the
case may be) pursuant to the  provisions of this Lease and enforceable  at the time of
such  damage or loss,  or  (b) occurrences  which  would  have been  covered  under any
insurance  required to be obtained and maintained by Landlord or Tenant (as the case may
be) under  Sections 20 and 21 of this Lease (as  applicable)  had such  insurance  been
 obtained  and  maintained  as required  therein.  The foregoing  waivers  shall be in
addition to, and not a limitation  of, any other  waivers or releases  contained in this
Lease.

22.2     Waiver
of Insurers.  Each party shall cause each  property and loss of income  insurance  policy
 required to be obtained by it pursuant to  Sections 20  and 21 to provide that the
insurer  waives all rights of recovery by way of subrogation  against either Landlord or
Tenant,  as the case may be, in connection  with any claims,  losses and  damages
 covered by such  policy.  If either  party fails to  maintain  property  or loss of
income  insurance required  hereunder,  such insurance shall be deemed to be self-insured
with a deemed full waiver of subrogation as set forth in the immediately preceding
sentence.

23.     Tenants
Default and Landlords Remedies.

23.1     Tenants
 Default.  The occurrence of any one or more of the following  events shall  constitute a
default under this Lease by Tenant:

|(a) | the
vacation or abandonment  of the Premises by Tenant.  Abandonment  is herein defined to
include,  but          is not limited to, any absence by Tenant from the Premises  for
five (5) business  days or longer while in          default of any other provision of
this Lease;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | the
failure by Tenant to make any payment of rent or additional  rent or any other payment
 required to be          made by Tenant  hereunder,  where such failure  continues for
five (5) days after written  notice  thereof          from Landlord that such payment was
not received;
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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---

|(c) | the
failure by Tenant to observe or perform  any of the  express or implied  covenants  or
 provisions  of          this Lease to be observed or performed  by Tenant,  other than
as  specified  in  Sections 23.1(a)  or (b)          above,  where such failure shall
 continue for a period of thirty (30) days after written  notice  thereof          from
 Landlord to Tenant;  provided,  however,  that if the nature of  Tenants  default is
such that more          than thirty  (30) days are  reasonably  required  for its cure,
 then Tenant  shall not be deemed to be in          default if Tenant shall  commence
such cure within said thirty (30) day period and  thereafter  diligently
         prosecute such cure to completion,  which  completion  shall occur not later
than sixty (60) days from the          date of such notice from Landlord;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | (i) the
making by Tenant or any guarantor  hereof of any general  assignment for the benefit of
creditors,          (ii) the  filing  by or  against  Tenant  or any  guarantor  hereof
of a  petition  to have  Tenant or any          guarantor  hereof  adjudged a bankrupt
 or a petition  for  reorganization  or  arrangement  under any law          relating to
bankruptcy  (unless,  in the case of a petition filed against Tenant or any guarantor
 hereof,          the same is dismissed  within  sixty (60) days),  (iii) the
 appointment  of a trustee or receiver to take          possession of  substantially  all
of Tenant's  assets  located at the Premises or of Tenants  interest in          this
Lease or of substantially  all of guarantors  assets,  where possession is not restored
to Tenant or          guarantor  within  sixty (60)  days,  or  (iv) the  attachment,
 execution  or other  judicial  seizure of          substantially  all of Tenant's
 assets  located at the  Premises or of  substantially  all of  guarantor's
         assets or of Tenant's interest in this Lease where such seizure is not
discharged within sixty (60) days;
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(e) | any
material  representation  or warranty made by Tenant or guarantor in this Lease or any
other  document          delivered in  connection  with the  execution  and delivery of
this Lease or pursuant to this Lease proves          to be incorrect in any material
respect; and
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(f) | Tenant
or guarantor  shall be liquidated or dissolved or shall begin  proceedings  towards its
liquidation          or dissolution.
|--- | -----------------------------------------------------------------------------------------------------------------------------------

Any notice sent by Landlord to
Tenant  pursuant to this  Section 23.1  shall be in lieu of, and not in addition to, any
notice required under California Code of Civil Procedure Section 1161.

23.2     Landlords
 Remedies;  Termination.  In the event of any such default by Tenant,  in addition to any
other remedies  available to Landlord under this Lease, at law or in equity,  Landlord
shall have the immediate option to terminate  this Lease and all rights of Tenant
 hereunder.  In the event that Landlord  shall elect to so terminate this Lease, then
Landlord may recover from Tenant:

|(a) | the
worth at the time of award of any unpaid rent which had been  earned at the time of such
 termination;          plus
|--- | ------------------------------------------------------------------------------------------------------------------------

|(b) | the
worth at the time of the award of the amount by which the unpaid  rent  which  would have
been  earned          after  termination  until the time of award  exceeds the amount of
such  rental  loss that  Tenant  proves          could have been reasonably avoided; plus
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | the
worth at the time of award of the  amount by which the unpaid  rent for the  balance of
the term after          the time of award exceeds the amount of such rental loss that
Tenant  proves could be reasonably  avoided;          plus
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | any
other amount  necessary to compensate  Landlord for all the detriment  proximately
 caused by Tenants          failure to perform its obligations  under this Lease or
which, in the ordinary course of things,  would be          likely  to  result  therefrom
 including,  but not  limited  to:  unamortized  Tenant  Improvement  costs;
         attorneys fees; brokers commissions; the costs of refurbishment,  alterations,
 renovation and repair of          the  Premises;  and removal  (including  the repair of
any damage  caused by such removal) and storage (or          disposal) of Tenants
personal property,  equipment,  fixtures,  Tenant Changes,  Tenant  Improvements and
         any other items which Tenant is required under this Lease to remove but does not
remove.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

As used in  Sections 23.2(a)  and
23.2(b) above, the worth at the time of award is computed by allowing  interest at the
Interest Rate set forth in  Section 1.14 of the Summary.  As used in  Section 23.2(c)
 above,  the worth at the time of award is computed by discounting  such amount at the
discount rate of the Federal  Reserve Bank of San Francisco at the time of award plus one
percent (1%).

23.3     Landlords
 Remedies;  Re-Entry  Rights.  In the event of any such  default by Tenant,  in addition
to any other  remedies  available to Landlord under this Lease,  at law or in equity,
 Landlord shall also have the right, with or without  terminating  this Lease,  to
re-enter the  Premises  and remove all persons and property  from the Premises;  such
property may be removed,  stored and/or  disposed of pursuant to  Section 12.4 of this
Lease or any other  procedures  permitted  by  applicable  law.  No re-entry or taking
 possession  of the  Premises by Landlord pursuant to this  Section 23.3,  and no
acceptance of surrender of the Premises or other action on Landlord's part, shall be
 construed as an election to terminate  this Lease unless a written  notice of such
 intention be given to Tenant or unless the termination thereof be decreed by a court of
competent jurisdiction.

23.4     Continuation
of Lease.  Landlord shall have the remedy described in California  Civil Code  Section 1951.4
(lessor may continue lease in effect after lessees  breach and  abandonment and recover
rent as it becomes due, if lessee has the right to sublet or assign, subject only to
reasonable  limitations).  Accordingly,  if Landlord does not elect to terminate  this
Lease on account of any default by Tenant,  Landlord may,  from time to time,  without
terminating  this Lease,  enforce all of its rights and remedies  under this Lease,
 including the right to recover all rent as it becomes due.

23.5     Landlords
Right to Perform.  Except as specifically  provided  otherwise in this Lease, all
covenants and agreements  by Tenant under this Lease shall be  performed by Tenant at
Tenants  sole cost and expense and without any  abatement or offset of rent.  If Tenant
shall fail to pay any sum of money (other than Monthly  Basic Rent) or perform any

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other act on its part to be paid or
performed  hereunder and such failure shall  continue for three (3) days with respect to
monetary  obligations  (or ten (10) days with respect to non-monetary  obligations,
 except in case of  emergencies,  in which such case,  such shorter period of time as is
reasonable  under the  circumstances) after Tenants  receipt of written notice thereof
from Landlord,  Landlord may, without waiving or releasing Tenant from any of Tenant's
 obligations,  make such  payment or perform  such other act on behalf of Tenant.  All
sums so paid by Landlord and all necessary  incidental  costs  incurred by Landlord in
performing  such other acts shall be payable by Tenant to Landlord within five (5) days
after demand therefor as additional rent.

23.6     Interest.
 If any monthly  installment  of Rent or  Operating  Expenses,  or any other  amount
 payable by Tenant  hereunder  is not received by Landlord by the date when due, it shall
bear  interest at the  Interest  Rate set forth in  Section 1.14  of the  Summary  from
the date due  until  paid.  All  interest,  and any late  charges imposed pursuant to
Section 23.7  below, shall be considered  additional rent due from Tenant to Landlord
under the terms of this Lease.

23.7     Late
Charges. Tenant  acknowledges  that, in addition to interest  costs,  the late payments
by Tenant to Landlord  of any  Monthly  Basic Rent or other sums due under this  Lease
will cause  Landlord  to incur  costs not contemplated  by this Lease,  the exact amount
of such costs being  extremely  difficult  and  impractical  to fix. Such other costs
include,  without limitation,  processing,  administrative and accounting charges and
late charges that may be imposed on Landlord by the terms of any mortgage,  deed of trust
or related loan documents  encumbering the  Premises,  the Building or the  Project.
 Accordingly,  if any monthly  installment  of Monthly  Basic Rent or Operating  Expenses
or any other  amount  payable by Tenant  hereunder  is not received by Landlord by the
due date thereof,  Tenant  shall pay to Landlord an  additional  sum of ten  percent
 (10%) of the overdue  amount as a late charge,  but in no event more than the  maximum
 late  charge  allowed  by law.  The  parties  agree that such late charge  represents  a
fair and  reasonable  estimate  of the costs that  Landlord  will incur by reason of any
late payment as  hereinabove  referred to by Tenant,  and the payment of late  charges
and  interest  are  distinct  and separate in that the  payment of interest is to
 compensate  Landlord  for the use of  Landlords  money by Tenant, while the payment of
late charges is to compensate  Landlord for Landlords  processing,  administrative  and
other costs  incurred by Landlord as a result of Tenants  delinquent  payments.
 Acceptance of a late charge or interest shall not  constitute  a waiver of Tenant's
 default with respect to the overdue  amount or prevent  Landlord  from exercising  any
of the other rights and remedies  available to Landlord under this Lease or at law or in
equity now or hereafter in effect.

23.8     Intentionally
Omitted.

23.9     Rights
 and  Remedies  Cumulative.  All  rights,  options  and  remedies  of  Landlord
 contained  in this Section 23 and elsewhere in this Lease (including  Section 28  below)
shall be construed and held to be cumulative, and no one of them shall be exclusive of
the other,  and Landlord  shall have the right to pursue any one or all of such  remedies
or any other  remedy or relief  which may be provided by law or in equity,  whether or
not stated in this Lease.  Nothing in this Section 23  shall be deemed to limit or
otherwise affect Tenants  indemnification  of Landlord pursuant to any provision of this
Lease.

23.10     Tenants
 Waiver of  Redemption.  Tenant hereby waives and  surrenders  for itself and all those
 claiming under it,  including  creditors of all kinds,  (i) any right and  privilege
 which it or any of them may have under any present or future law to redeem any of the
Premises or to have a  continuance  of this Lease after  termination of this Lease or of
 Tenant's  right of  occupancy  or  possession  pursuant  to any court  order or any
 provision hereof,  and (ii) the  benefits of any present or future law which exempts
 property from liability for debt or for distress for rent.

23.11     Costs
Upon Default and  Litigation.  Tenant shall pay to Landlord and its  mortgagees as
 additional  rent all the expenses  incurred by Landlord or its mortgagees in connection
with any default by Tenant  hereunder or the exercise of any remedy by reason of any
 default by Tenant  hereunder,  including  reasonable  attorneys  fees and expenses.  If
Landlord or its mortgagees  shall be made a party to any litigation  commenced  against
Tenant or any litigation  pertaining to this Lease or the Premises,  at the option of
Landlord and/or its mortgagees,  Tenant, at its expense,  shall provide  Landlord and/or
its mortgagees with counsel approved by Landlord and/or its mortgagees and shall pay all
costs incurred or paid by Landlord and/or its mortgagees in connection with such
litigation.

24.     Landlords
 Default.  Landlord shall not be in default in the  performance  of any obligation
 required to be performed by Landlord  under this Lease unless  Landlord  has failed to
perform such  obligation  within  thirty (30) days after the receipt of written  notice
 from Tenant  specifying  in detail  Landlords  failure to perform; provided  however,
 that if the  nature of  Landlord's  obligation  is such that  more  than  thirty  (30)
days are required  for its  performance,  then  Landlord  shall not be deemed in default
if it  commences  such  performance within  such  thirty  (30) day period and  thereafter
 diligently  pursues  the same to  completion.  Upon any such uncured  default  by
 Landlord,  Tenant may  exercise  any of its rights  provided  in law or at equity;
 provided, however:  (a) Tenant  shall have no right to offset or abate rent in the event
of any  default  by  Landlord  under this Lease,  except to the extent  offset  rights
are  specifically  provided  to Tenant in this Lease;  (b) Tenant shall have no right to
terminate this Lease;  (c) Tenants  rights and remedies  hereunder  shall be limited to
the extent  (i) Tenant  has  expressly  waived in this Lease any of such  rights or
 remedies  and/or  (ii) this  Lease otherwise  expressly  limits  Tenants  rights or
 remedies,  including  the  limitation  on  Landlord's  liability contained in Section 31
 hereof,  and (d) in no event will Landlord be liable for consequential  damages or loss
of business profits.

25.     Subordination.
 Without  the  necessity  of any  additional  document  being  executed  by Tenant  for
the purpose of  effecting  a  subordination,  and at the  election  of  Landlord  or any
 mortgagee  of a mortgage or a beneficiary  of a deed of trust now or hereafter
 encumbering  all or any portion of the  Building or Site,  or any lessor of any ground
or master lease now or hereafter  affecting  all or any portion of the Building or Site,
 this Lease  shall be subject and  subordinate  at all times to such ground or master
 leases  (and such  extensions  and modifications  thereof),  and to the lien of such
 mortgages  and deeds of trust (as well as to any  advances  made thereunder  and  to
 all  renewals,  replacements,  modifications  and  extensions  thereof).
 Notwithstanding  the foregoing,  Landlord and any mortgagee  and/or ground lessor of
Landlord,  as  applicable,  shall have the right to subordinate  or cause to be
 subordinated  any or all ground or master  leases or the lien of any or all  mortgages
or deeds of trust to this  Lease.  In the event that any ground or master  lease
 terminates  for any

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reason or any mortgage or deed of
trust is  foreclosed  or a conveyance  in lieu of  foreclosure  is made for any reason,
 at the election of  Landlords  successor  in interest,  Tenant  shall attorn to and
become the tenant of such  successor. Tenant  hereby  waives its rights  under any
current or future law which gives or purports to give Tenant any right to terminate or
otherwise  adversely  affect this Lease and the obligations of Tenant hereunder in the
event of any such  foreclosure  proceeding or sale.  Tenant  covenants and agrees to
execute and deliver to Landlord  within ten (10) days after  receipt of written  demand
by  Landlord  and in the form  reasonably  required  by  Landlord,  any additional
 documents  evidencing  the priority or  subordination  of this Lease with respect to any
such ground or master  lease or the lien of any such  mortgage or deed of trust or
Tenants  agreement  to attorn.  Should  Tenant fail to sign and return  any such
 documents  within  said ten day  period,  Tenant  shall be in default  hereunder without
the benefit of any additional notice or cure periods specified in Section 23.1 above.

26.     Estoppel
Certificate.

26.1     Tenants
 Obligations.  Within ten (10) days following  Landlords  written request,  Tenant shall
execute and deliver to Landlord  an estoppel  certificate,  in a form  substantially
 similar to the form of  Exhibit F attached hereto,  certifying:  (a) the  Commencement
 Date of this Lease;  (b) that this Lease is unmodified and in full force and effect (or,
if modified,  that this Lease is in full force and effect as  modified,  and stating the
date and nature of such  modifications);  (c) the  date to which the rent and other sums
 payable  under this Lease have been paid;  (d) that  there are not,  to the best of
 Tenant's  knowledge,  any  defaults  under this Lease by either Landlord or Tenant,
 except as specified in such  certificate;  and (e) such other matters as are reasonably
requested by Landlord.  Any such estoppel  certificate  delivered  pursuant to this
Section 26.1 may be relied upon by any  mortgagee,  beneficiary,  purchaser or
 prospective  purchaser of any portion of the Site, as well as their assignees.

26.2     Tenants
 Failure to Deliver.  Tenant's  failure to deliver  such  estoppel  certificate  within
such time shall  constitute  a default  hereunder  without the  applicability  of the
notice and cure  periods  specified  in Section 23.1  above and shall be conclusive  upon
Tenant that:  (a) this  Lease is in full force and effect without modification,  except
as may be  represented  by  Landlord;  (b) there  are no uncured  defaults in  Landlord's
 or Tenant's performance (other than Tenant's failure to deliver the estoppel
 certificate);  and (c) not more than one (1) months rental has been paid in advance.
 Tenant shall indemnify,  defend (with counsel reasonably  approved by Landlord in
writing) and hold Landlord harmless from and against any and all claims,  judgments,
 suits,  causes of action, damages,  losses,  liabilities and expenses (including
attorneys fees and court costs) attributable to any failure by Tenant to timely deliver
any such estoppel certificate to Landlord pursuant to Section 26.1 above.

27.     Intentionally
Omitted.

28.     Modification
and Cure Rights of Landlords Mortgagees and Lessors.

28.1     Modifications.
 If, in  connection  with  Landlords  obtaining or entering  into any  financing or
ground lease for any portion of the Building or Site,  the lender or ground  lessor shall
 request  modifications  to this Lease,  Tenant shall,  within ten (10) days after
request  therefor,  execute an amendment to this Lease  including such  modifications,
 provided  such  modifications  are  reasonable,  do not  increase the  obligations  of
Tenant hereunder, or adversely affect the leasehold estate created hereby or Tenants
rights hereunder.

28.2     Cure
Rights.  In the event of any default on the part of Landlord,  Tenant will give notice by
 registered or certified  mail to any  beneficiary  of a deed of trust or mortgagee
 covering the Premises or ground  lessor of Landlord whose address shall have been
furnished to Tenant,  and shall offer such beneficiary,  mortgagee or ground lessor a
reasonable  opportunity to cure the default  (including with respect to any such
beneficiary or mortgagee, time to obtain possession of the Premises,  subject to this
Lease and Tenant's rights  hereunder,  by power of sale or a judicial foreclosure, if
such should prove necessary to effect a cure).

29.     Quiet
 Enjoyment.  Landlord  covenants  and agrees with Tenant  that,  upon Tenant  performing
 all of the covenants  and  provisions on Tenants part to be observed and  performed
 under this Lease  (including  payment of rent  hereunder),  Tenant shall have the right
to use and occupy the Premises in accordance with and subject to the terms and conditions
of this Lease as against all persons claiming by, through or under Landlord.

30.     Transfer
of  Landlords  Interest.  The term  "Landlord"  as used in this Lease,  so far as
 covenants  or obligations  on the part of the  Landlord  are  concerned,  shall be
limited to mean and include  only the owner or owners,  at the time in question,  of the
fee title to, or a lessees  interest in a ground lease of, the Site.  In the event of
any  transfer  or  conveyance  of any such  title or  interest  (other  than a transfer
 for  security purposes  only),  the transferor  shall be  automatically  relieved of all
covenants and obligations on the part of Landlord  contained in this Lease accruing
 after the date of such transfer or conveyance.  Landlord and Landlords transferees  and
assignees shall have the absolute right to transfer all or any portion of their
 respective  title and interest in the Site,  the Building,  the Premises  and/or this
Lease  without the consent of Tenant,  and such transfer  or  subsequent  transfer  shall
 not be deemed a  violation  on  Landlords  part of any of the terms and conditions of
this Lease.

31.     Limitation
 on Landlords  Liability.  Notwithstanding  anything  contained in this Lease to the
contrary, the  obligations  of Landlord  under this Lease  (including any actual or
alleged breach or default by Landlord) do not constitute personal obligations of the
individual  partners,  directors,  officers,  members or shareholders of Landlord or
Landlords  partners,  and Tenant shall not seek recourse against the individual
 partners,  directors, officers,  members or  shareholders  of Landlord or against
 Landlords  partners or any other  persons or entities having any interest in Landlord,
 or any of their personal  assets for  satisfaction  of any liability with respect to
this Lease. In addition,  in  consideration  of the benefits  accruing  hereunder to
Tenant and  notwithstanding anything  contained in this Lease to the  contrary,  Tenant
 hereby  covenants and agrees for itself and all of its successors  and assigns  that the
 liability  of  Landlord  for its  obligations  under

-21-

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this Lease  (including  any
liability  as a result of any actual or  alleged  failure,  breach or  default  hereunder
 by  Landlord),  shall be limited  solely to, and  Tenants and its  successors  and
assigns  sole and  exclusive  remedy shall be against, Landlords interest in the
Building, and no other assets of Landlord.

32.     Miscellaneous.

32.1     Governing
 Law.  This Lease  shall be governed  by, and  construed  pursuant  to, the laws of the
State of California.

32.2     Successors
and Assigns.  Subject to the provisions of Section 30  above, and except as otherwise
 provided in this Lease,  all of the  covenants,  conditions  and  provisions of this
Lease shall be binding upon,  and shall inure to the benefit of, the parties hereto and
their  respective  heirs,  personal  representatives  and permitted successors  and
 assigns;  provided,  however,  no rights  shall inure to the benefit of any  Transferee
 of Tenant unless the Transfer to such Transferee is made in compliance  with the
provisions of Section 14,  and no options or other rights which are expressly made
personal to the original  Tenant  hereunder or in any rider  attached  hereto shall be
assignable to or exercisable by anyone other than the original Tenant under this Lease.

32.3     No
Merger.  The  voluntary  or other  surrender  of this Lease by Tenant or a mutual
 termination  thereof shall not work as a merger  and  shall,  at the  option  of
 Landlord,  either  (a) terminate  all or any  existing subleases, or (b) operate as an
assignment to Landlord of Tenant's interest under any or all such subleases.

32.4     Professional
 Fees.  If either  Landlord or Tenant  should  bring suit  against the other with
 respect to this Lease,  including for unlawful  detainer or any other relief against the
other  hereunder,  then all costs and expenses  incurred  by the  prevailing  party
 therein  (including,  without  limitation,  its actual  appraisers, accountants,
attorneys and other professional fees and court costs), shall be paid by the other party.

32.5     Waiver.
 The waiver by either  party of any breach by the other party of any term,  covenant or
 condition herein  contained  shall  not be  deemed to be a waiver  of any  subsequent
 breach of the same or any other  term, covenant and condition  herein  contained,  nor
shall any custom or practice which may become  established  between the parties in the
 administration  of the terms  hereof be deemed a waiver of, or in any way affect,  the
right of any party to insist  upon the  performance  by the other in strict  accordance
 with said  terms.  No waiver of any default of either party  hereunder  shall be implied
from any  acceptance by Landlord or delivery by Tenant (as the case may be) of any rent
or other  payments due hereunder or any omission by the  non-defaulting  party to take
any action on account of such  default if such  default  persists or is  repeated,  and
no express  waiver shall affect defaults  other than as specified in said waiver.  The
 subsequent  acceptance of rent  hereunder by Landlord shall not be deemed to be a waiver
of any  preceding  breach by Tenant of any term,  covenant or  condition of this Lease
other than the failure of Tenant to pay the  particular  rent so accepted,  regardless of
 Landlord's  knowledge of such preceding breach at the time of acceptance of such rent.

32.6     Terms
and  Headings.  The words  Landlord  and Tenant as used herein shall  include the
plural as well as the singular.  Words used in any gender  include  other  genders.  The
Section  headings of this Lease are not a part of this Lease and shall  have no effect
 upon the  construction  or  interpretation  of any part  hereof.  Any deletion of
language  from this Lease prior to its  execution  by Landlord  and Tenant  shall not be
 construed  to raise any presumption,  canon of construction or implication,  including,
 without limitation, any implication that the parties intended thereby to state the
converse of the deleted language.

32.7     Time.
 Time is of the essence with respect to performance  of every  provision of this Lease in
which time or  performance is a factor.  All  references in this Lease to days shall
mean calendar days unless  specifically modified herein to be business days.

32.8     Prior
 Agreements;  Amendments.  This  Lease  (and  the  Exhibits  attached  hereto)  contain
 all  of the covenants,  provisions,  agreements,  conditions  and  understandings
 between  Landlord and Tenant  concerning the Premises and any other matter covered or
mentioned in this Lease,  and no prior  agreement or  understanding,  oral or written,
 express or implied,  pertaining  to the Premises or any such other  matter shall be
effective  for any purpose.  No provision  of this Lease may be amended or added to
except by an  agreement  in writing  signed by the parties hereto or their  respective
 successors in interest.  The parties  acknowledge  that all prior  agreements,
representations  and negotiations  are deemed  superseded by the execution of this Lease
to the extent they are not expressly incorporated herein.

32.9     Separability.
 The  invalidity  or  unenforceability  of any  provision of this Lease (except for
Tenants obligation to pay Monthly Basic Rent and Excess  Expenses  under  Sections 3
 and 4 hereof) shall in no way affect, impair or invalidate any other provision  hereof,
 and such other  provisions  shall remain valid and in full force and effect to the
fullest extent permitted by law.

32.10     Recording.
 Except  as  otherwise  provided  in this  Lease,  neither  this  Lease,  nor  any
 memorandum, affidavit or other writing with respect  thereto,  shall be recorded by
Tenant or by anyone acting  through,  under or on behalf of Tenant,  and the recording
 thereof in violation of this  provision  shall make this Lease null and void at
Landlord's election.

32.11     Exhibits.
 All Exhibits  attached to this Lease are hereby  incorporated in this Lease as though
set forth at length herein.

32.12     Accord
and  Satisfaction.  No payment by Tenant or receipt by  Landlord  of a lesser  amount
than the rent payment herein  stipulated  shall be deemed to be other than on account of
the rent,  nor shall any  endorsement or statement  on any  check  or any  letter
 accompanying  any  check or  payment  as rent be  deemed  an  accord  and satisfaction,
 and Landlord may accept such check or payment without  prejudice to Landlords  right to
recover the balance of such rent or pursue any other remedy  provided in this Lease.
 Tenant  agrees that each of the foregoing covenants  and  agreements

-22-

---

shall be  applicable to any covenant
or agreement  either  expressly  contained in this Lease or imposed by any statute or at
common law.

32.13     Financial
 Statements.  Upon ten (10) days prior written  request from Landlord  (which  Landlord
may make at any time during the Term but no more often than once in any calendar  year),
 Tenant  shall  deliver to Landlord a current  financial  statement of Tenant and any
 guarantor of this Lease.  Such  statements  shall be prepared in accordance  with
 generally  acceptable  accounting  principles  and certified as true in all material
 respects by Tenant (if Tenant is an  individual)  or by an authorized  officer of Tenant
(if Tenant is a corporation or limited liability company) or a general partner of Tenant
(if Tenant is a partnership).

32.14     No
 Partnership.  Landlord  does not,  in any way or for any  purpose,  become a partner  of
Tenant in the conduct of its business,  or otherwise,  or joint venturer or a member of a
joint  enterprise with Tenant by reason of this Lease.

32.15     Force
 Majeure.  In the event that either party  hereto shall be delayed or hindered in or
prevented  from the  performance  of any act  required  hereunder by reason of strikes,
 lock-outs,  labor  troubles,  inability to procure materials,  failure of power,
 governmental  moratorium or other governmental action or inaction (including failure,
refusal or delay in issuing permits,  approvals and/or authorizations),  injunction or
court order, riots, insurrection,  war,  fire,  earthquake,  flood or other  natural
 disaster or other reason of a like nature not the fault of the  party  delaying  in
 performing  work or doing  acts  required  under the  terms of this  Lease  (but
excluding delays due to financial  inability) (herein  collectively,  Force Majeure
Delays),  then performance of such act shall be excused for the period of the delay and
the period for the  performance  of any such act shall be extended for a period
 equivalent  to the period of such delay.  The  provisions  of this  Section 32.15  shall
not apply to nor operate to excuse Tenant from the payment of Monthly Basic Rent,
 Operating Expenses,  additional rent or any other payments strictly in accordance with
the terms of this Lease.

32.16     Counterparts.
 This Lease may be executed in one or more  counterparts,  each of which shall constitute
an original and all of which shall be one and the same agreement.

32.17     Nondisclosure
 of  Lease  Terms. Tenant  acknowledges  and  agrees  that  the  terms  of this  Lease
 are confidential  and constitute  proprietary  information of Landlord.  Disclosure of
the terms could adversely affect the  ability of  Landlord  to  negotiate  other  leases
 and impair  Landlords  relationship  with other  tenants. Accordingly,  Tenant agrees
that it, and its partners, officers, directors,  employees, agents and attorneys, shall
not  intentionally  and  voluntarily  disclose  the terms and  conditions  of this Lease
to any  newspaper or other publication  or any other tenant or apparent  prospective
 tenant of the Building or other  portion of the Project, or real estate agent,  either
 directly or  indirectly,  without the prior written  consent of Landlord,  provided,
however, that Tenant may disclose the terms to prospective subtenants or assignees under
this Lease.

32.18     Independent
 Covenants. This Lease shall be construed as though the  covenants  herein  between
 Landlord and Tenant are independent and not dependent and Tenant hereby  expressly
 waives the benefit of any statute to the contrary  and agrees that if Landlord  fails to
perform  its  obligations  set forth  herein,  Tenant  shall not be entitled to make any
repairs or perform any acts  hereunder at  Landlords  expense or to any setoff of the
Rent or other amounts owing hereunder against Landlord;  provided,  however,  that the
foregoing shall in no way impair the right of Tenant to commence a separate  action
 against  Landlord for any  violation by Landlord of the  provisions hereof so long as
notice is first given to  Landlord  and any holder of a mortgage  or deed of trust
 covering  the Building,  Project  or any  portion  thereof,  of whose  address  Tenant
 has  theretofore  been  notified,  and an opportunity is granted to Landlord and such
holder to correct such violations as provided above.

33.     Lease
Execution.

33.1     Tenants
 Authority. If  Tenant  executes  this  Lease as a limited  liability  company,
 partnership  or corporation,  then Tenant and the persons and/or  entities  executing
this Lease on behalf of Tenant  represent and warrant that:  (a) Tenant is a duly
 organized and validly  existing  limited  liability  company,  partnership  or
corporation,  as the case may be, and is  qualified  to do business in the state in which
the Premises are located; (b) such  persons and/or  entities  executing  this Lease are
duly  authorized to execute and deliver this Lease on Tenant's behalf in accordance with
the Tenant's  operating  agreement (if Tenant is a limited  liability  company), Tenants
 partnership  agreement (if Tenant is a  partnership),  or a duly adopted  resolution of
Tenant's board of directors  and  Tenants  by-laws  (if Tenant is a  corporation);  and
 (c) this  Lease is binding  upon  Tenant in accordance with its terms.  Concurrently
 with Tenants  execution and delivery of this Lease to Landlord and/or at any time
during the Lease Term  within ten (10) days of  Landlords  request,  Tenant  shall
 provide to Landlord a copy of any  documents  reasonably  requested  by  Landlord
 evidencing  Tenants  representations  and  warranties hereunder.

33.2     Joint
and Several  Liability.  If more than one person or entity  executes this Lease as
Tenant:  (a) each of them is and shall be jointly and severally  liable for the
covenants,  conditions,  provisions and agreements of this Lease to be kept,  observed
and  performed by Tenant;  and (b) the act or signature  of, or notice from or to, any
one or more of them with  respect to this Lease shall be binding  upon each and all of
the persons and entities executing  this  Lease as Tenant  with the same force and effect
as if each and all of them had so acted or signed, or given or received such notice.

33.3     Building
 Name and  Signage.  Landlord  shall have the right at any time to  designate  and/or
 change the name and/or address of the Project,  the Building and/or any other building
in the Project,  and to install,  affix and maintain any and all signs on the  exterior
and on the interior of the Project,  the Building  and/or any other building in the
Project,  as Landlord may, in Landlord's  sole  discretion,  desire.  Tenant shall not
use the name of the  Project,  the  Building or any other  building in the  Project,  or
use  pictures or  illustrations  of the Project,  the Building or any other building in
the Project,  in advertising or other publicity,  without the prior written consent of
Landlord.

-23-

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33.4     Landlords
 Title;  Air  Rights.  Landlords  title is and  always  shall  be  paramount  to the
 title of Tenant.  Nothing  herein  contained  shall empower  Tenant to do any act which
can, shall or may encumber the title of  Landlord.  No rights to any view or to light or
air over any  property,  whether  belonging  to Landlord or any other person, are granted
to Tenant by this Lease.

33.5     Time of
Essence.  Time is of the essence of this Lease and each of its provisions.

33.6     No
Option.  The  submission  of this Lease for  examination  or execution by Tenant does not
 constitute a reservation  of or option for the Premises  and this Lease shall not become
 effective as a Lease until it has been executed by Landlord and delivered to Tenant.

34.     Waiver
 of Jury  Trial.  EACH  PARTY  HEREBY  WAIVES  ANY RIGHT TO A TRIAL BY JURY IN ANY
 ACTION  SEEKING SPECIFIC  PERFORMANCE  OF ANY  PROVISION OF THIS LEASE,  FOR DAMAGES FOR
ANY BREACH UNDER THIS LEASE,  OR OTHERWISE FOR ENFORCEMENT OF ANY RIGHT OR REMEDY
HEREUNDER.

35.     Termination
 of  Existing  Lease.  Landlord  and Tenant  acknowledge  and agree that  effective  as
of the Commencement  Date of this Lease,  Tenants  Existing Lease shall terminate (and
Tenant shall surrender and deliver exclusive  possession of the premises  covered under
the Existing Lease (except for those portions of such premises that  constitute  the
 Premises  hereunder)  to Landlord in vacant,  broom clean  condition  and  otherwise  in
the condition required under the Existing Lease);  provided,  however,  that Tenant
acknowledges and agrees that Tenant shall  continue to be liable  under the Existing
 Lease for those  obligations  under the  Existing  Lease that are intended to survive
 termination  including,  without  limitation,  Tenants  indemnity  obligations  and
 Tenants reconciliation  obligations  for operating  expenses  under the Existing
 Lease,  all of which  obligations  Tenant acknowledges and agrees shall survive the
expiration of the Existing Lease.

IN WITNESS WHEREOF, the parties have
executed this Lease as of the day and year first above written.

|                           |                                      |                                            |                                  |                                    | 
|-------------------------- | ------------------------------------ | ------------------------------------------ | -------------------------------- | ---------------------------------- | 
|                           |                                      |                                            |                                  |                                    | 
|TENANT:                    |                                      | LANDLORD:                                  |                                 
|                           |                                      |                                            |                                  |                                    | 
|HIFN, INC.                 |                                      | POI-CARLSBAD, INC., a Delaware corporation |                                 
|a Deleware Corporation     |                                      |                                            |                                 
|                           |                                      | By: /s/ Christopher B. Mahon               |                                 
|*By: /s/ William R. Walker |                                      |                                            |                                 
|                           |                                      |                                            | Print Name: Christopher B. Mahon |                                   
|                           | Print Name: William R. Walker        |                                            |                                  |                                    | 
|                           |                                      |                                            |                                  | Print Title: Senior Vice President | 
|                           | Print Title: Chief Financial Officer |                                            |                                  |                                    | 
|                           |                                      |                                            |                                  |                                    | 
|                           |                                      | By: /s/ Deborah Street                     |                                 
|*By: /s/ William R. Walker |                                      |                                            |                                 
|                           |                                      |                                            | Print Name: Deborah Street       |                                   
|                           | Print Name: William R. Walker        |                                            |                                  |                                    | 
|                           |                                      |                                            |                                  | Print Title: Vice President        | 
|                           | Print Title: Chief Financial Officer |                                            |                                  |                                    | 
|                           |                                      |                                            |                                  |                                    | 

*NOTE:If Tenant is a California
corporation, then one of the following alternative requirements must be satisfied:

|(A) | This
Lease must be signed by two (2)  officers of such  corporation:  one being the chairman
of the board,          the president or a vice president,  and the other being the
secretary,  an assistant secretary,  the chief          financial  officer  or an
 assistant  treasurer.  If one  (1)  individual  is  signing  in two  (2) of the
         foregoing  capacities,  that  individual  must  sign  twice;  once as one
 officer  and again as the other          officer.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(B) | If
there is only one (1) individual  signing in two (2)  capacities,  or if the two (2)
signatories do not          satisfy the  requirements  of (A) above,  then  Tenant  shall
 deliver to  Landlord a certified  copy of a          corporate  resolution  in a form
 reasonably  acceptable to Landlord  authorizing  the  signatory(ies)  to
         execute this Lease.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If Tenant is a corporation
 incorporated in a state other than California,  then Tenant shall deliver to Landlord a
certified  copy  of  a  corporate  resolution  in  a  form  reasonably   acceptable  to
 Landlord  authorizing  the signatory(ies) to execute this Lease.

-24-

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# EXHIBIT A

# SITE PLAN

EXHIBIT A-1-

---

# 

# EXHIBIT B

# PREMISES

EXHIBIT B-1-

---

# 

# EXHIBIT C

# WORK LETTER AGREEMENT

This
Work Letter Agreement (Work Letter  Agreement) sets forth the terms and conditions
 relating to the construction of improvements  for the Premises.  All references in this
Work Letter  Agreement to the Lease shall mean the relevant portions of the Lease to
which this Work Letter Agreement is attached as Exhibit C.

# SECTION 1

# BASE, SHELL, AND CORE

Landlord
 has  constructed,  through its  contractor,  the base,  shell and core of the  Premises
 and the Building  (collectively,  the Base,  Shell and Core),  and Tenant  shall
 accept the Base,  Shell and Core in its current As-Is condition  existing as of the
date of the Lease and the Commencement  Date.  Landlord shall install in the Premises
 certain  Tenant  Improvements  (as defined below) pursuant to the provisions of this
Work Letter Agreement.  Except for the Tenant  Improvement  work  described  in this Work
Letter  Agreement  and except for the Allowance set forth below,  Landlord shall not be
obligated to make or pay for any  alterations or  improvements to the Premises, the
Building or the Project.

# SECTION 2

# CONSTRUCTION DRAWINGS FOR THE PREMISES

Prior
to the execution of this Lease,  Landlord and Tenant have approved those certain
 preliminary  space plans for the  construction  of certain  improvements  in the
 Premises,  which space  plans have been  prepared by Maggetti Elam, dated December 21,
 2004 and December 6,  2004 (collectively,  the Preliminary Space Plan). Within five
(5) business  days of the full  execution of the Lease,  Landlord  and Tenant shall
 mutually  approve a final space plan for the Tenant  Improvements  (Final Space Plan).  Based upon and in conformity  with the Final Space Plan,  Landlord  shall cause
its architect and engineers to prepare and deliver to Tenant,  for Tenants  approval,
detailed  specifications and engineered working drawings for the tenant  improvements
shown on the Final Space Plan (the  Working  Drawings).  The  Working  Drawings  shall
 incorporate  modifications  to the Final  Space Plan as necessary  to comply with the
floor load and other  structural  and system  requirements  of the  Building.  To the
extent that the finishes and  specifications  are not  completely set forth in the Final
Space Plan for any portion of the tenant  improvements  depicted  thereon,  the actual
 specifications  and finish work shall be in accordance with the  specifications for the
Building's  standard tenant  improvement items, as determined by Landlord.  Within three
(3) business days after  Tenants  receipt of the Working  Drawings,  Tenant shall
approve or disapprove  the same, which approval shall not be unreasonably  withheld;
 provided,  however,  that Tenant may only disapprove the Working  Drawings  to the
extent  such  Working  Drawings  are  inconsistent  with the Final Space Plan and only if
Tenant  delivers to Landlord,  within such three (3)  business  days period,  specific
 changes  proposed by Tenant which are  consistent  with the Final Space Plan and do not
 constitute  changes  which would  result in any of the circumstances  described in items
 (i) through  (iv) below.  If any such revisions are timely and properly proposed by
Tenant,  Landlord  shall cause its architect and engineers to revise the Working
 Drawings to  incorporate  such revisions and submit the same for Tenant's  approval in
accordance with the foregoing  provisions,  and the parties shall follow the foregoing
 procedures for approving the Working  Drawings  until the same are finally  approved by
Landlord and Tenant.  Upon  Landlord's and Tenant's  approval of the Working  Drawings,
 the same shall be known as the  Approved  Working  Drawings.  The  tenant
 improvements  shown on the  Approved  Working  Drawings  shall be referred  to herein as
the  Tenant  Improvements. Once the  Approved  Working  Drawings  have been  approved
 by Landlord  and Tenant,  Tenant  shall make no changes,  change  orders or
 modifications  thereto  without the prior written  consent of  Landlord,  which  consent
may be  withheld in  Landlord's  sole  discretion  if such change or modification  would:
 (i) directly or indirectly  delay the Substantial  Completion of the Premises;  (ii) increase
the cost of designing or constructing the Tenant  Improvements above the cost of the
tenant  improvements  depicted in the Final Space Plan;  (iii) be of a quality  lower
than the quality of the standard  tenant  improvement  items for the  Building;  and/or
 (iv) require  any changes to the Base,  Shell and Core or  structural  improvements  or
systems  of the  Building.  The  Final  Space  Plan,  Working  Drawings  and  Approved
 Working  Drawings  shall be collectively referred to herein as, the Construction
Drawings.

# SECTION 3

# CONSTRUCTION AND PAYMENT FOR COSTS OF TENANT IMPROVEMENTS

The
contractor  which shall  construct the  Improvements  shall be a contractor  selected
 pursuant to the following  procedure.  The  Approved  Working  Drawings  shall  be
 submitted  by  Landlord  to three  (3)  general contractors:  one (1) such  general
 contractor  shall be  selected  by Tenant on or before  the date the  Approved Working
 Drawings are approved by Landlord and Tenant and which  contractor  so selected by
Tenant shall be subject to  Landlord's  reasonable  approval.  Each such  contractor
 shall be  invited  to submit a  sealed,  fixed  price contract  bid (on  such  bid  form
as  Landlord  shall  designate)  to  construct  the  Tenant  Improvements.  Each
contractor  shall  be  notified  in  the  bid  package  of  the  time  schedule  for
 construction  of  the  Tenant Improvements.  The  subcontractors  utilized by the
Contractor shall be subject to Landlord's  reasonable  approval and the bidding
 instructions  shall  provide that as to work  affecting  the  structure of the Project
 and/or the systems and equipment of the Project,  Landlord shall be entitled to
designate the  subcontractors.  The bids shall be  submitted  promptly  to  Landlord  and
Tenant and a  reconciliation  shall be  performed  by Landlord to adjust inconsistent  or
incorrect  assumptions  so that a like-kind  comparison  can be made and a low bidder
 determined. Landlord,  after  consultation  with Tenant,  shall select the  contractor
 who shall be the lowest  bidder and who states that it will be able to meet Landlord's
 construction  schedule.  The contractor selected may be referred to herein as the
 Contractor.  Landlord shall cause the Contractor to (i) obtain  all  applicable
 building  permits for  construction  of the Tenant

EXHIBIT C-1-

---

Improvements,  and  (ii) construct
 the Tenant  Improvements  as  depicted on the Approved Working  Drawings,  in compliance
with such building permits and all applicable laws in effect at the time of
 construction,  and in good workmanlike  manner.  Landlord shall pay for the cost of the
design and construction of the Tenant  Improvements in an amount up to, but not
exceeding,  Fifteen Dollars ($15.00) per usable square foot of the Premises  (i.e.,  up
to One Hundred  Eighty Three  Thousand Three Hundred  Dollars  ($183,300.00),  based on
12,220 usable square feet of the Premises (the Tenant  Improvement  Allowance)
 (less space planning cost already incurred by Landlord in the amount of Two Thousand
Three Hundred  Forty-Five and 25/100  Dollars  ($2,345.25).  The cost of the design and
construction of the Tenant  Improvements shall include Landlord's  construction
 supervision and  management  fee in an amount equal to the product of (i) five  percent
 (5%) and (ii) the  amount equal to the sum of the  Allowance  and the  Over-Allowance
 Amount (as such term is defined  below).  Tenant  shall pay for all costs in excess of
the  Allowance  (Over-Allowance  Amount),  which  payment  shall be
made to  Landlord  in cash within ten (10) days after  Tenant's  receipt of invoice
 therefor from  Landlord  and, in any event,  prior to the date Landlord  causes the
 Contractor to commence the actions  described in the first  sentence of this  Section 3.
In the event that after Tenant pays the  Over-Allowance  Amount,  Tenant  requests any
 changes,  change  orders or modifications  to the Approved  Working  Drawings  (which
 Landlord  approves  pursuant to  Section 2  above) which increase  the cost to
 construct  the  Tenant  Improvements,  Tenant  shall  pay such  increased  cost to
 Landlord immediately upon Landlord's  request therefor,  and, in any event, prior to the
date Landlord causes the Contractor to commence  construction of the changes,  change
orders or modifications.  In no event shall Landlord be obligated to pay for any of
Tenant's  furniture,  computer systems,  telephone systems,  equipment or other personal
property which may be depicted on the  Construction  Drawings;  such items shall be paid
for by Tenant.  Tenant shall not be entitled to receive in cash or as a credit  against
any rent or  otherwise,  any portion of the  Allowance not used to pay for the cost of
the design and construction of the Tenant Improvements.

Tenant
 acknowledges  and  agrees  that  Landlords  construction  of the  Tenant  Improvements
 shall  be performed  during the term of the Existing  Lease and/or  after the
 Commencement  Date of this Lease and that such construction  shall not constitute a
 constructive  eviction of the Premises nor entitle Tenant to any abatement of Rent under
the Existing  Lease or this Lease.  Tenant agrees to use  commercially  reasonable
 efforts to cooperate with Landlord during Landlords construction of the Tenant
Improvements.

# SECTION 4

# SUBSTANTIAL COMPLETION

For
purposes of the Lease,  Substantial  Completion  of the Premises  shall occur upon the
completion of construction  of the Tenant  Improvements  in the Premises  pursuant to the
 Approved  Working  Drawings,  with the exception of any punch list items and any tenant
fixtures,  work-stations,  built-in furniture,  or equipment to be installed by Tenant or
under the supervision of Contractor.

# SECTION 5

# MISCELLANOUS

5.1
     Tenants  Entry Into the Premises Prior to  Substantial  Completion. Subject to the
terms hereof and provided that Tenant and its agents do not interfere with  Contractors
 work in the Building and the Premises, at  Landlords  reasonable  discretion,
 Contractor  shall  allow  Tenant  access  to  the  Premises  prior  to the Substantial
 Completion  of the Premises for the purpose of Tenant  installing  overstandard
 equipment or fixtures (including  Tenant's data and telephone  equipment) in the
Premises.  Prior to Tenant's  entry into the Premises as permitted by the terms of this
 Section 5.1,  Tenant shall submit a schedule to Landlord and Contractor,  for their
approval,  which  schedule  shall  detail the timing and purpose of Tenant's  entry.  In
 connection  with any such entry,  Tenant  acknowledges  and agrees  that  Tenant's
 employees,  agents,  contractors,  consultants,  workmen, mechanics,  suppliers and
invitees shall fully  cooperate,  work in harmony and not, in any manner,  interfere with
Landlord or Landlords  Contractor,  agents or representatives in performing work in the
Building and the Premises, or  interfere  with the  general  operation  of the  Building
 and/or the  Project.  If at any time any such person representing  Tenant shall not be
cooperative or shall  otherwise cause or threaten to cause any such disharmony or
interference,  including,  without  limitation,  labor  disharmony,  and Tenant fails to
immediately  institute and maintain  corrective  actions as  directed  by  Landlord,
 then  Landlord  may revoke  Tenants  entry  rights upon twenty-four  (24) hours prior
written notice to Tenant.  Tenant  acknowledges  and agrees that any such entry into and
 occupancy  of the Premises or any portion  thereof by Tenant or any person or entity
 working for or on behalf of Tenant shall be deemed to be subject to all of the terms,
 covenants,  conditions  and  provisions of the Lease, excluding  only the covenant to
pay Basic Rent (until the  occurrence of the  Commencement  Date).  Tenant  further
acknowledges  and agrees that  Landlord  shall not be liable for any injury,  loss or
damage which may occur to any of Tenants  work made in or about the Premises in
 connection  with such entry or to any property  placed  therein prior to the
 Commencement  Date,  the same being at Tenants  sole risk and  liability.  Tenant shall
be liable to Landlord for any damage to any portion of the Premises,  including the
Tenant  Improvement  work,  caused by Tenant or any of Tenants employees,  agents,
contractors,  consultants,  workmen,  mechanics,  suppliers and invitees. In the event
that the  performance  of Tenant's work in  connection  with such entry causes extra
costs to be incurred by Landlord or requires the use of any Building  services,  Tenant
shall promptly reimburse Landlord for such extra costs  and/or shall pay  Landlord  for
such  Building  services at  Landlord's  standard  rates then in effect.  In addition,
 Tenant shall hold Landlord harmless from and indemnify,  protect and defend Landlord
against any loss or damage to the Premises or Project and against  injury to any persons
 caused by Tenants  actions  pursuant to this Section 5.1.

5.2
     Tenants  Representative.  Tenant has designated  Maritza Geuss as its sole
 representative  with respect to the matters set forth in this Work Letter  Agreement,
 who shall have full authority and  responsibility to act on behalf of the Tenant as
required in this Work Letter Agreement.

5.3
     Landlords  Representative.  Landlord has designated John  Couvillion as its sole
 representative with respect to the matters set forth in this Work Letter  Agreement,
 who, until further  notice to Tenant,  shall have full authority and responsibility to
act on behalf of the Landlord as required in this Work Letter Agreement.

EXHIBIT C-2-

---

5.4
     Time of the Essence in This Work Letter  Agreement. Unless otherwise  indicated,
 all references herein to a number of days  shall mean and refer to  calendar  days.
 If any item  requiring  approval  is timely disapproved  by Landlord,  the procedure
 for  preparation  of the document and approval  thereof shall be repeated until the
 document is approved by Landlord.  Both  Landlord and Tenant  shall use  commercially
 reasonable,  good faith,  efforts and all due  diligence  to  cooperate  with each other
to complete  all phases of the  Construction Drawings and the  permitting  process and to
receive the permits,  as soon as possible  after the  execution of the Lease,  and, in
that regard,  shall meet on a scheduled  basis to be determined by Landlord and Tenant,
 to discuss progress in connection with the same.

5.5
     Tenants Lease  Default.  Notwithstanding  any provision to the contrary  contained
in the Lease, if an event of default by Tenant as described in  Section 23  of the Lease
or any default by Tenant under this Work Letter  Agreement has occurred at any time on or
before the  Substantial  Completion  of the Premises,  then (i) in addition  to all other
 rights and  remedies  granted to Landlord  pursuant to the Lease,  at law and/or in
equity, Landlord  shall have the right to cause  Contractor  to cease the  construction
 of the  Premises  (in which  case, Tenant  shall be  responsible  for any delay in the
 Substantial  Completion  of the  Premises  caused by such work stoppage,  and  (ii) all
 other  obligations  of Landlord  under the terms of this Work Letter  Agreement  shall
be forgiven  until  such time as such  default  is cured  pursuant  to the terms of the
Lease (in which  case,  Tenant shall be  responsible  for any delay in the  Substantial
 Completion  of the  Premises  caused by such  inaction by Landlord).  In  addition,  if
the Lease is  terminated  prior to the  Commencement  Date,  for any  reason due to a
default by Tenant as described in Section 23 of the Lease or under this Work Letter
 Agreement,  in addition to any other remedies  available to Landlord under the Lease,
 at law and/or in equity,  Tenant shall pay to Landlord,  as additional  rent  under the
Lease,  within  five (5) days of receipt  of a  statement  therefor,  any and all costs
incurred by Landlord  (including  any portion of the Tenant  Improvement  Allowance
 disbursed by Landlord) and not reimbursed  or  otherwise  paid by Tenant  through  the
date of such  termination  in  connection  with the  Tenant Improvements to the extent
planned,  installed and/or  constructed as of such date of termination,  including,  but
not limited to, any costs related to the removal of all or any portion of the Tenant
 Improvements  and restoration costs related thereto.

EXHIBIT C-3-

---

# EXHIBIT D

# FORM OF COMMENCEMENT
NOTICE

This
 Commencement  Notice is delivered  this _______ day of  __________________,  200_, by
 POI-CARLSBAD, INC., a Delaware  corporation  ("Landlord")  to  _____________________
 (Tenant),  pursuant to the  provisions of Section 2.1  of that certain  Office  Lease
(the  Lease)  dated  __________,  20__ , by and between  Landlord and Tenant  covering
 certain  space in the  Building  known as  __________________.  All terms used  herein
with their initial letter capitalized shall have the meaning assigned to such terms in
the Lease.

Gentlemen:

In accordance with the
above-referenced Lease, we wish to advise and/or confirm as follows:

|1. | That
the Premises have been  accepted by Tenant as being  substantially  complete in
 accordance  with the          Lease, and that there is no deficiency in construction.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | That
 Tenant  has  accepted  and is in  possession  of the  Premises,  and  acknowledges  that
 under  the          provisions of the Lease,  the Term of the Lease is for
 ______________  (___) years,  with  ______________          (___) options to renew for
 ______________  (___) years each, and commenced upon the Commencement  Date of
         ________________,  20___ and is  currently  scheduled  to expire on
 ________________,  20___,  subject to          earlier termination as provided in the
Lease.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | That
in accordance with the Lease,  rental payment has commenced (or shall commence) on
 ________________,          20___.
|-- | --------------------------------------------------------------------------------------------------------------------------

|4. | If
the  Commencement  Date of the Lease is other than the first day of the month,  the first
 billing will          contain a pro rata adjustment.  Each billing  thereafter,  with
the exception of the final billing,  shall          be for the full amount of the monthly
installment as provided for in the Lease.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | Rent
is due and  payable  in  advance  on the  first day of each and every  month  during  the
Term of the          Lease.   Your  rent   checks   should  be  made   payable   to
  ____________________________________   at          ____________________________________.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | The
exact  number of rentable  square feet within the  Premises is  ____________  square
 feet.  The exact          number of usable square feet within the Premises is
____________ square feet.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7. | Tenant's
 Percentage,  as  adjusted  based  upon the exact  number of  rentable  square  feet
 within  the          Premises, is _______%.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------

| | IN
WITNESS WHEREOF, this instrument has been duly executed by Landlord as of the date first
written above.
| | ----------------------------------------------------------------------------------------------------------

| |                                               |                                            
| | --------------------------------------------- | -------------------------------------------
| |                                               |                                            
| | LANDLORD:                                    
| |                                               |                                            
| | POI-CARLSBAD, INC., a Delaware corporation   
| |                                               |                                            
| | By: _________________________________________
| |                                               | Print Name: _____________________________  
| |                                               | Print Title: ______________________________
| |                                               |                                            
| | By: _________________________________________
| |                                               | Print Name: _____________________________  
| |                                               | Print Title: ______________________________

EXHIBIT D-1-

---

# EXHIBIT E

# RULES AND REGULATIONS

1.     No sign,
 advertisement,  name or notice  shall be  installed  or  displayed on any part of the
outside or inside of the Building  without the prior  written  consent of Landlord.
 Landlord  shall have the right to remove, at Tenants  expense and without  notice,  any
sign  installed or displayed in violation of this rule. All approved signs or lettering
on doors and walls shall be printed,  painted,  affixed or inscribed at the expense of
Tenant by a person approved by Landlord, using materials and in a style and format
approved by Landlord.

2.     Tenant
 shall not place  anything  or allow  anything  to be placed  near the glass of any
 window,  door, partition or wall which may appear  unsightly from outside the Premises.
 No awnings or other  projection  shall be attached to the  outside  walls of the
 Building  without  the prior  written  consent of  Landlord.  No  curtains, blinds,
 shades or screens shall be attached to or hung in, or used in connection  with,  any
window or door of the Premises, other than Building standard materials, without the prior
written consent of Landlord.

3.     Tenant
shall not obstruct any sidewalks,  halls,  passages,  exits,  entrances,  elevators,
 escalators or stairways of the Building.  The halls,  passages,  exits,  entrances,
 elevators,  escalators and stairways are not for the general  public,  and Landlord
shall in all cases retain the right to control and prevent access thereto of all persons
whose presence in the judgment of Landlord would be  prejudicial to the safety,
 character,  reputation and  interests of the  Building and its tenants;  provided,  that
nothing  herein  contained  shall be construed to prevent such access to persons with
whom any tenant normally deals in the ordinary  course of its business,  unless such
persons are engaged in illegal  activities.  Tenant and no employee,  invitee,  agent,
 licensee or contractor of Tenant shall go upon or be entitled to use any portion of the
roof of the Building.

4.     The
 directory of the Building  will be provided  exclusively  for the display of the name
and location of tenants only, and Landlord reserves the right to exclude any other names
therefrom.

5.     All
cleaning and  janitorial  services  for the  Building and the Premises  shall be provided
 exclusively through Landlord or Landlords  janitorial  contractors in accordance with
the provisions of Section 18.1(d) of the Lease.  No person or persons  other than those
 approved by Landlord  shall be employed by Tenant or  permitted  to enter the  Building
 for the  purpose  of  cleaning  the same.  Tenant  shall  not cause any  unnecessary
 labor by carelessness or  indifference  to the good order and cleanliness of the
Premises.  Landlord shall not in any way be responsible  to Tenant for loss of  property
 on the  Premises,  however  occurring,  or for any damage to Tenants property by the
janitors or any other employee or any other person.

6.     Landlord
will furnish Tenant,  free of charge,  with two keys to each door lock in the Premises.
 Landlord may impose a reasonable  charge for any  additional  keys.  Tenant may not make
or have made  additional  keys, and Tenant  shall not alter any lock or install a new
 additional  lock or bolt on any door or window of its  Premises. Tenant,  upon
 termination  of its  tenancy,  shall  deliver  to  Landlord  the keys of all doors
 which  have been furnished to, or otherwise  procured by Tenant,  and, in the event of
loss of any keys, shall pay Landlord the cost of  replacing  the same or of  changing
 the lock or locks  opened  by such  lost  key if  Landlord  shall  deem it necessary to
make such change.

7.     Electric
wires, telephones,  telegraphs,  burglar alarms or other similar apparatus shall not be
installed in the Premises  except with the approval and under the  direction of Landlord.
 The location of  telephones,  call boxes and any  other  equipment  affixed  to the
 Premises  shall be  subject  to the  approval  of  Landlord.  Any installation of
telephones,  telegraphs,  electric wires or other electric  apparatus made without
permission shall be  removed  by Tenant at  Tenants  own  expense.  No  machines  other
 than  standard  office  machines,  such as typewriters  and  calculators,  photo
 copiers,  personal  computers  and word  processors,  and  vending  machines permitted
by the Lease, shall be used in the Premises without the approval of Landlord.

8.     No
furniture,  freight,  or equipment of any kind shall be brought into the Building
 without prior notice to Landlord  and all moving of the same into or out of the
 Building  shall be done at such time and in such manner as Landlord shall designate.  No
furniture,  equipment or merchandise  shall be received in the Building or carried up or
down in the  elevator,  except  between  such hours as shall be  designated  by Landlord.
 Deliveries  during normal  office  hours shall be limited to normal  office  supplies
and other small items.  No  deliveries  shall be made which impede or interfere with
other tenants or the operation of the Building.

9.     Tenant
 shall not place a load upon any floor of the  Premises  which  exceeds  the load per
 square  foot which such floor was  designed  to carry and which is allowed by law.
 Landlord  shall have the right to  prescribe the  weight,  size and  position  of all
 equipment,  materials,  furniture  or  other  property  brought  into the Building.
 Heavy objects,  if such objects are  considered  necessary by Tenant,  as determined by
Landlord,  shall stand on such  platforms as  determined  by Landlord to be necessary to
properly  distribute  the weight.  Business machines and  mechanical  equipment  which
cause noise or vibration that may be transmitted to the structure of the Building  or to
any space  therein to such a degree as to be  objectionable  to  Landlord  or to any
tenants in the Building,  shall be placed and  maintained  by Tenant,  at Tenants
 expense,  on  vibration  eliminators  or other devices  sufficient to eliminate  noise
or vibration.  Landlord will not be responsible  for loss of, or damage to, any such
equipment or other  property from any cause,  and all damage done to the Building by
maintaining or moving such equipment or other property shall be repaired at the expense
of Tenant.

10.     Tenant
shall not use or keep in the Premises any kerosene,  gasoline or inflammable  or
combustible  fluid or material other than those limited  quantities  necessary for the
operation or  maintenance of office  equipment. Tenant  shall not use or permit to be
used in the  Premises  any foul or  noxious  gas or  substance,  or permit or allow the
Premises to be

EXHIBIT E-1-

---

occupied or used in a manner
 offensive or  objectionable  to Landlord or other  occupants of the  Project  by reason
of noise,  odors or  vibrations,  nor shall  Tenant  bring  into or keep in or about the
Premises any birds or animals.

11.     Tenant
shall not use any method of heating or air-conditioning other than that supplied by
Landlord.

12.     Tenant
 shall not  waste  electricity,  water or  air-conditioning  and  agrees to  cooperate
 fully  with Landlord to assure the most effective operation of the Buildings heating
and  air-conditioning  and to comply with any governmental  energy-saving  rules, laws or
regulations of which Tenant has actual notice, and shall not adjust controls  other than
room  thermostats  installed  for Tenant's use.  Tenant shall keep  corridor  doors
closed and shall close window coverings at the end of each business day.

13.     Landlord
 reserves the right from time to time, in Landlord's  sole and absolute  discretion,
 exercisable without prior notice and without  liability to Tenant,  to:  (a) name or
change the name of the  Building,  Site or Project;  (b) change the address of the
Building or Project,  and/or  (c) install,  replace or change any signs in, on or about
the Common  Areas,  the  Building or Site  (except for  Tenants  signs,  if any,  which
are  expressly permitted by the Lease).

14.     Landlord
 reserves the right to exclude from the Building  between the hours of 6:00 p.m.  and
 7:00 a.m., or such other hours as may be established from time to time by Landlord,  and
on legal holidays,  any person unless that  person  is  known  to the  person  or
 employee  in  charge  of the  Building  and has a pass or is  properly identified.
 Landlord  shall not be liable for damages for any error with regard to the  admission
 to or exclusion from the  Building of any  person.  Tenant  shall be  responsible  for
all persons for whom it requests  passes and shall be liable to Landlord for all acts of
such  persons.  Landlord  reserves  the right to prevent  access to the Building in case
of invasion,  mob,  riot,  public  excitement or other  commotion by closing the doors or
by other appropriate action.

15.     Tenant
shall close and lock all doors of its Premises  and  entirely  shut off all water
 faucets or other water  apparatus,  and,  except with regard to Tenant's  computers and
other  equipment  which  reasonably  require electricity  on a 24-hour basis,  all
 electricity,  gas or air outlets  before Tenant and its employees  leave the Premises.
 Tenant shall be  responsible  for any damage or injuries  sustained by other tenants or
occupants of the Building or by Landlord for noncompliance with this rule.

16.     The
toilet  rooms,  toilets,  urinals,  wash bowls and other  apparatus  shall not be used
for any purpose other than that for which they were constructed,  and no foreign
 substances of any kind whatsoever shall be thrown therein.

17.     Tenant
 shall not sell,  or permit the sale at retail,  of  newspapers,  magazines,
 periodicals,  theater tickets,  or any other goods or  merchandise  to the general
 public in or on the  Premises.  Tenant shall not make any  room-to-room  solicitation
 of business from other  tenants in the Project.  Tenant shall not use the Premises for
any business or activity other than that specifically provided for in the Lease.

18.     Tenant
 shall not install any radio or  television  antenna,  loudspeaker  or other  device on
the roof or exterior  walls of the Building.  Tenant shall not interfere  with radio or
 television  broadcasting  or reception from or in the Building or elsewhere.

19.     Except
as expressly  permitted in the Lease,  Tenant shall not mark, drive nails,  screw or
drill into the partitions,  window mullions,  woodwork or plaster,  or in any way deface
the Premises or any part thereof,  except to install normal wall hangings.  Tenant shall
repair any damage resulting from noncompliance under this rule.

20.     Tenant
shall not install,  maintain or operate  upon the Premises any vending  machines  without
the prior written consent of Landlord, which shall not be unreasonably withheld.

21.     Canvassing,
 soliciting and distribution of handbills or any other written  material,  and peddling
in and around the Project or the Building are expressly prohibited, and each tenant shall
cooperate to prevent same.

22.     Landlord
 reserves  the right to exclude or expel from the Project  and/or the Building any person
who, in Landlord's  judgment,  is  intoxicated  or under the  influence of liquor or
drugs or who is in violation of any of the Rules and Regulations of the Project or
Building.

23.     Tenant
 shall store all its trash and garbage  within its  Premises.  Tenant  shall not place in
any trash box or  receptacle  any material  which cannot be disposed of in the  ordinary
 and  customary  manner of trash and garbage  disposal.  All garbage and refuse disposal
shall be made in accordance with directions  reasonably  issued from time to time by
Landlord.

24.     The
Premises  shall not be used for the storage of  merchandise  held for sale to the general
 public,  or for lodging or for  manufacturing  of any kind.  No cooking  shall be done
or permitted by Tenant on the  Premises, except that use by Tenant of  Underwriters'
 Laboratory-approved  equipment for brewing coffee,  tea, hot chocolate and  similar
 beverages  shall be  permitted  and the use of a microwave  shall be  permitted,
 provided  that such equipment and use is in accordance with all applicable  federal,
 state,  county and city laws, codes,  ordinances, rules and regulations.

25.     Tenant
shall not use in any space,  or in the public halls of the  Building,  any hand trucks
except those equipped  with rubber tires and side  guards,  or such other
 material-handling  equipment as Landlord may approve. Tenant shall not bring any other
vehicles of any kind into the Building.

26.     Tenant
 shall  not use the name of the  Project  or  Building  in  connection  with,  or in
 promoting  or advertising, the business of Tenant, except for Tenants address.

EXHIBIT E-2-

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27.     Tenant
 agrees that it shall  comply with all fire and security  regulations  that may be issued
from time to time by Landlord,  and Tenant also shall provide Landlord with the name of a
designated  responsible employee to represent  Tenant in all matters  pertaining to such
fire or security  regulations.  Tenant shall  cooperate  fully with Landlord in all
matters concerning fire and other emergency procedures.

28.     Tenant
 assumes  any  and  all  responsibility  for  protecting  its  Premises  from  theft,
 robbery  and pilferage.  Such  responsibility  shall  include  keeping  doors  locked
and other  means of entry to the  Premises closed.

29.     Landlord
may waive any one or more of these Rules and  Regulations  for the benefit of Tenant or
any other tenant,  but no such waiver by Landlord  shall be construed as a waiver of such
Rules and  Regulations  in favor of Tenant or any other such tenant,  nor prevent
 Landlord from  thereafter  enforcing any such Rules and  Regulations against any and all
of the tenants in the Building.

30.     These
 Rules and  Regulations  are in  addition  to,  and shall not be  construed  to in any
way modify or amend,  in whole or in part,  the terms,  covenants,  agreements  and
 conditions  of any lease of  premises in the Project or Building.

31.     Landlord
 reserves the right to make such other and reasonable  Rules and Regulations as, in its
judgment, may from time to time be needed for safety,  security,  care and cleanliness of
the Project and/or Building and for the  preservation  of good order  therein.  Tenant
 agrees to abide by all such Rules and  Regulations  hereinabove stated and any
additional rules and regulations which are adopted.

32.     Tenant
shall be  responsible  for the  observance  of all of the  foregoing  rules by Tenant's
 employees, agents, clients, customers, invitees or guests.

33.     Tenant
shall not lay linoleum,  tile,  carpet or other  similar  floor  covering so that the
same shall be affixed  to the floor of the  Premises  in any  manner  except by a paste,
 or other  material  which may easily be removed with water, the use of cement or other
similar adhesive  materials being expressly  prohibited.  The method of affixing any such
 linoleum,  tile,  carpet or other similar floor  covering shall be subject to the
approval of Landlord.  The expense of repairing any damage resulting from a violation of
this rule shall be borne by Tenant.

# PARKING RULES AND
REGULATIONS

In addition to the parking
provisions  contained in the Lease to which this Exhibit E is attached,  the following
rules and regulations shall apply with respect to the use of the Building's parking
facilities.

1.     Every
parker is required to park and lock his/her own vehicle.  All  responsibility  for damage
to or loss of vehicles is assumed by the parker and Landlord  shall not be  responsible
 for any such damage or loss by water, fire, defective brakes, the act or omissions of
others, theft, or for any other cause.

2.     Tenant
 shall not park or permit its  employees  to park in any parking  areas  designated  by
Landlord as areas for parking by visitors to the Project.  Tenant shall not leave
 vehicles in the parking areas  overnight nor park any vehicles in the parking  areas
other than  automobiles,  motorcycles,  motor  driven or  non-motor  driven bicycles or
four wheeled trucks.

3.     Parking
 stickers or any other  device or form of  identification  supplied by Landlord as a
condition  of use of the parking  facilities shall remain the property of Landlord.  Such
parking  identification  device must be displayed as requested  and may not be mutilated
 in any manner.  The serial  number of the parking  identification device may not be
 obliterated.  Devices are not  transferable  and any device in the possession of an
unauthorized holder will be void.

4.     No
overnight or extended term storage of vehicles shall be permitted.

5.     Vehicles
must be parked entirely within painted stall lines of a single parking stall.

6.     All
directional signs and arrows must be observed.

7.     The speed
limit within all parking areas shall be five (5) miles per hour.

8.     Parking
is  prohibited:  (a) in  areas not striped for  parking;  (b) in  aisles;  (c) where  "no
parking" signs are posted;  (d) on ramps; (e) in  cross-hatched areas; and (f) in
reserved spaces and in such other areas as may be designated by Landlord or Landlord's
parking operator.

9.     Loss or
theft of parking  identification  devices must be reported to the Management  Office
 immediately, and a lost or stolen  report  must be filed by the  Tenant  or user of such
 parking  identification  device at the time.  Landlord  has the  right  to  exclude  any
 vehicle  from  the  parking  facilities  that  does  not have an identification device.

10.     Any
 parking  identification  devices  reported  lost or  stolen  found  on any  unauthorized
 car will be confiscated and the illegal holder will be subject to prosecution.

11.     Washing,
 waxing,  cleaning or  servicing  of any vehicle in any area not  specifically  reserved
for such purpose is prohibited.

12.     The
parking  operators,  managers or  attendants  are not  authorized  to make or allow any
 exceptions to these rules and regulations.

EXHIBIT E-3-

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13.     Tenants
 continued  right to park in the parking  facilities is conditioned  upon Tenant abiding
by these rules and  regulations  and  those  contained  in this  Lease.  Further,  if the
Lease  terminates  for any  reason whatsoever, Tenants right to park in the parking
facilities shall terminate concurrently therewith.

14.     Tenant
agrees to sign a parking  agreement with Landlord or Landlord's  parking  operator
 within five (5) days of request,  which  agreement  shall  provide the manner of payment
of monthly  parking fees and  otherwise be consistent with the Lease and these rules and
regulations.

15.     Landlord
  reserves  the  right  to  refuse  the  sale  or  use  of  monthly  stickers  or  other
 parking identification  devices to any tenant or person who  willfully  refuse to comply
with these  rules and  regulations and all city, state or federal ordinances, laws or
agreements.

16.     Landlord
 reserves the right to establish and change  parking fees,  and to modify and/or adopt
such other reasonable and  non-discriminatory  rules and regulations for the parking
 facilities as it deems necessary for the operation of the parking  facilities.  Landlord
 may refuse to permit any person who  violates  these rules to park in the parking
 facilities,  and any violation of the rules shall  subject the vehicle to removal,  at
such vehicle owners expense.

EXHIBIT E-4-

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# EXHIBIT F

# SAMPLE FORM OF TENANT ESTOPPEL CERTIFICATE

1.     Attached
  hereto  is  a  true,   correct  and  complete   copy  of  that   certain   Office
 Lease  dated ________________,  20__ between  Landlord and Tenant (the  Lease),  which
demises  Premises  which are located at ____________________________________.  The  Lease
 is now in full  force  and  effect  and has  not  been  amended, modified or
supplemented, except as set forth in Section 6 below.

2.     The term
of the Lease commenced on ________________, 20__.

3.     The term
of the Lease is currently scheduled to expire on ________________, 20__.

4.     Tenant
has no option to renew or extend the Term of the Lease except: .

5.     Tenant
has no  preferential  right to purchase  the  Premises or any portion of the  Building or
Site upon which the  Premises  are  located,  and Tenant has no rights or options to
expand into other space in the  Building except:
________________________________________________________________.

6.     The Lease
has: (Initial One)

(     )
not been amended, modified, supplemented, extended, renewed or assigned.

(     )
been amended,  modified,  supplemented,  extended, renewed or assigned by the following
described                   agreements, copies of which are attached hereto:

.

7.     Tenant
has accepted and is now in  possession  of the Premises and has not sublet,  assigned or
encumbered the Lease, the Premises or any portion thereof except as follows:
__________________________________________________________________________________________________________________

8.     The
current Monthly Basic Rent is $______________; and current monthly parking charges are
$____________.

9.     Tenant's
 Percentage is __________%,  and Tenant's  Percentage of Operating  Expenses currently
payable by Tenant is  $______________  per month,  which  amount is  Landlord's  current
 estimate of Tenant's  Percentage  of Operating Expenses in excess of:

| |                |  |                                                                                                         
| | -------------- |  | --------------------------------------------------------------------------------------------------------
| | (Complete One) |  | $____________ per year (expense stop), or
the Operating Expenses incurred in calendar year ____________.

10.     The
amount of security deposit (if any) is $_______________.  No other security deposits have
been made.

11.     All
rental  payments  payable by Tenant  have been paid in full as of the date  hereof.  No
rent under the Lease has been paid for more than thirty (30) days in advance of its due
date.

12.     All work
 required to be performed by Landlord  under the Lease has been  completed  and has been
accepted by Tenant, and all tenant improvement allowances have been paid in full.

13.     To the
best of Tenants  knowledge,  as of the date hereof,  there are no defaults on the part
of Landlord or Tenant under the Lease.

14.     Tenant
 has no  defense  as to its  obligations  under the Lease and  claims no  set-off  or
 counterclaim against Landlord.

15.     Tenant
has no right to any concession  (rental or otherwise) or similar  compensation  in
connection  with renting the space it occupies, except as expressly provided in the Lease.

16.     All
 insurance  required of Tenant under the Lease has been  provided by Tenant and all
premiums have been paid.

17.     There
has not been filed by or against  Tenant a petition  in  bankruptcy,  voluntary  or
 otherwise,  any assignment of creditors,  any petition  seeking  reorganization  or
arrangement  under the  bankruptcy  laws of the United States or any state thereof,  or
any other action brought  pursuant to such  bankruptcy laws with respect to Tenant.

18.     Tenant
pays rent due  Landlord  under the Lease to Landlord  and does not have any  knowledge of
any other person who has any right to such rents by collateral assignment or otherwise.

EXHIBIT F-1-

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The foregoing
 certification  is made with the knowledge  that is about to [fund a loan to Landlord or
purchase the Building  from  Landlord],  and that is relying  upon the  representations
 herein  made in  [funding  such loan or purchasing the Building].

Dated:  _________________, 20__.

| |          |  |                                                   
| | -------- |  | --------------------------------------------------
| | TENANT |  | _______________________________________________   
| |          |  | a ______________________________________________  
| |          |  |                                                   
| |          |  | By: ____________________________________________  
| |          |  | Print Name:_______________________________________
| |          |  | Its: _____________________________________________

EXHIBIT F-2-

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